Market Fracturing

[uppi]

At the end of the day, I think that if forced pretty much every company, except maybe John Deere, would have to opt for the "blue" market and cut the red loose. What impact does that have? Is it unavoidable that it will come to that? What happens to national network advertising, do we have to reduce all ad purchases to regional runs? What happens to companies that already have gigantic investment in both markets?

I don't think any company has to opt for the blue market. For one, if some companies go for the blue market, there will be openings for their competitors to go for the red market. Sure it might be a smaller market, but with the right marketing a company might be able to sell at prices that wouldn't be competitive in the blue market. Actually, it is not so much companies that have to decide, but brands. A company can have two brands, one for the red market and one for the blue market. That way, they would lose a bit of the efficiency because they need multiple campaigns, but those campaigns might be much more effective. Some people might notice, but a bit of indirection in the ownership structure can go a long way to minimize the number of people who will know and care.

And at least for the moment, I don't think that companies have to choose if they don't want to. After all, Nike didn't have to make a controversial campaign.

 

[brennan]

People are showing their interest in social justice by buying trainers made by underpaid children in the third world?

 

[Timsup2nothin]

People are showing their interest in social justice by buying trainers made by underpaid children in the third world?

More like showing their interest in social justice by which trainers made by underpaid children in the third world they choose to buy. At the end of the day all of the choices, other than shoelessness, have that in common so it is a nonfactor.

 

[El_Machinae]

More like showing their interest in social justice by which trainers made by underpaid children in the third world they choose to buy. At the end of the day all of the choices, other than shoelessness, have that in common so it is a nonfactor.

There's also the price that you're willing to pay for the shoes and the alternative use of the difference. I don't think anyone should choose Nike shoe if they'd normally prefer a cheaper shoe. But don't let me argue against the idea that consumption choices matter and that every choice has spectrum of desirable knock-on effects. For some some, an expensive shoe is going to be purchased and there's then only a small premium for expressing support.

 

[civvver]

More like showing their interest in social justice by which trainers made by underpaid children in the third world they choose to buy. At the end of the day all of the choices, other than shoelessness, have that in common so it is a nonfactor.

New balance are made in the usa.

 

[TheMeInTeam]

Not a fan of virtue signaling on either side, or the pony show this topic managed to turn into.

He had the numbers of a low-tier starter/high grade backup and he doesn't have a roster spot, all because of the butthurt over the fact that he didn't stand when people wanted. The media sensationalism over that remains idiotic, and the NFL comes off as actively disingenuous. They blackball THIS guy? Okay fine if you want strict conduct in the league, but where are these standards when you're dealing with performance enhancing drug user #4398 on the latest 4 game suspension or DUI convict #235? Even the overbearing substance abuse policy still implies actions that are more questionable than what Kaepernick did, which was at most worthy of ignoring him rather than what happened.

Buffalo could sign him to low money right now and he'd be a substantial upgrade over the dumpster fire they've created, though perhaps that would violate the quest to be actively terrible.

As for what companies should do, is it really impossible to avoid virtue signaling in a way that alienates people? The quality/price of shoes is not tethered to social justice.

 

[Timsup2nothin]

New balance are made in the usa.

A dubious claim that depends on which New Balance shoe you are talking about and how inclined you are to see the Federal Trade Commission enforce their own policy on labeling products as "made in USA."

This is a great take on the thread topic though.

New Balance has opted for a "Red Market" strategy. I never see New Balance ads here in deep state of Blue California, and don't really recall seeing them in stores, though I can't claim I look at shoes much or at brands. But I'm sure that they promote that "made in USA" line heavily in places where it would work...and where consumers would be willing to write off factual reports about "actual US content" as just evil lib'ruls using fake news to attack a good American company driven by right wing values. No doubt they are ideally positioned to pick up any red market losses that Nike sustains due to their blue market strategy.

 

[Timsup2nothin]

Not a fan of virtue signaling on either side, or the pony show this topic managed to turn into.

He had the numbers of a low-tier starter/high grade backup and he doesn't have a roster spot, all because of the butthurt over the fact that he didn't stand when people wanted. The media sensationalism over that remains idiotic, and the NFL comes off as actively disingenuous. They blackball THIS guy? Okay fine if you want strict conduct in the league, but where are these standards when you're dealing with performance enhancing drug user #4398 on the latest 4 game suspension or DUI convict #235? Even the overbearing substance abuse policy still implies actions that are more questionable than what Kaepernick did, which was at most worthy of ignoring him rather than what happened.

Buffalo could sign him to low money right now and he'd be a substantial upgrade over the dumpster fire they've created, though perhaps that would violate the quest to be actively terrible.

As for what companies should do, is it really impossible to avoid virtue signaling in a way that alienates people? The quality/price of shoes is not tethered to social justice.

I didn't really want to turn this into a thread about Kaepernick's situation vis a vis the NFL. If you want to start a thread about it either here or in the sports forum I'd be more than happy to tell you why I think you are totally wrong in most of what you just said.

 

[TheMeInTeam]

I didn't really want to turn this into a thread about Kaepernick's situation vis a vis the NFL. If you want to start a thread about it either here or in the sports forum I'd be more than happy to tell you why I think you are totally wrong in most of what you just said.

I don't know, there's some market fracturing discussion to be had in there somewhere. The NFL itself is attempting to balance this, showing its typical hypocrisy in the process but it does seem pretty aware of the split markets that watch it. Given the media coverage they had their hand forced in a way Nike/most firms do not when it comes to red vs blue marketing.

 

[Timsup2nothin]

I don't know, there's some market fracturing discussion to be had in there somewhere. The NFL itself is attempting to balance this, showing its typical hypocrisy in the process but it does seem pretty aware of the split markets that watch it. Given the media coverage they had their hand forced in a way Nike/most firms do not when it comes to red vs blue marketing.

The NFL definitely has to deal with the market fracturing problem, but the assumption that their "mistreatment" of Kaepernick is part of that needs far more support than is available.

The NFL is placed right at the front of the market split because Trump carries tremendous endorsement weight in the red market and he has wielded that heavily against the NFL, probably due far more to his personal grudge than out of any actual strategy. With that against them in the red market I would say that the NFL would be well advised to just go all in on blue market strategy and let the chips fall as they may in the red market.

 

[TheMeInTeam]

The NFL definitely has to deal with the market fracturing problem, but the assumption that their "mistreatment" of Kaepernick is part of that needs far more support than is available.

Regardless of how you feel about his individual case, their response to the anthem issue (including backpedaling on it this offseason) definitely shows market fracture pressure. I consider them a somewhat rare exception compared to most companies. Companies not quite so in the spotlight as to be called out by the president don't have to take a stand, and IMO in most cases probably shouldn't from a financial perspective long-term, unless their demographic served is already skewed.

 

[Timsup2nothin]

Regardless of how you feel about his individual case, their response to the anthem issue (including backpedaling on it this offseason) definitely shows market fracture pressure. I consider them a somewhat rare exception compared to most companies. Companies not quite so in the spotlight as to be called out by the president don't have to take a stand, and IMO in most cases probably shouldn't from a financial perspective long-term, unless their demographic served is already skewed.

The "getting called out by the president" part is certainly what makes their situation unusual. It isn't really unique, because without involving the president there are still a number of companies who have been vilified in the right wing media that have been similarly forced to deal directly with the split market. All of those companies, caught somewhat flatfooted by a situation thrust upon them more or less out of left field, are going to bumble around trying to find a response. For the NFL, having Trump's grudge as an unwavering fixture they are pretty much stuck as far as the red market goes no matter what they do.

I'm impressed by Nike having taken a proactive approach rather than just hoping they could lie under the radar playing both markets. I think they illustrated a reality that pretty much all companies if you get down to brass tacks do have a heavily skewed demographic just because there is a lot more money in the blue market than the red. If they mark the start of a trend we could see the red market more or less abandoned to products that can't compete in the blue market so have no alternative but the red market they are stuck with.

 

[civvver]

A dubious claim that depends on which New Balance shoe you are talking about and how inclined you are to see the Federal Trade Commission enforce their own policy on labeling products as "made in USA."

This is a great take on the thread topic though.

New Balance has opted for a "Red Market" strategy. I never see New Balance ads here in deep state of Blue California, and don't really recall seeing them in stores, though I can't claim I look at shoes much or at brands. But I'm sure that they promote that "made in USA" line heavily in places where it would work...and where consumers would be willing to write off factual reports about "actual US content" as just evil lib'ruls using fake news to attack a good American company driven by right wing values. No doubt they are ideally positioned to pick up any red market losses that Nike sustains due to their blue market strategy.

I don't think new balance advertises on tv. Just internet/magazines.

I haven't dived deep into the issue, just posting what I've searched before, that new balance is the only major athletic shoe company that says made in usa. I don't really care where my shoes are made

 

[Timsup2nothin]

I don't think new balance advertises on tv. Just internet/magazines.

I haven't dived deep into the issue, just posting what I've searched before, that new balance is the only major athletic shoe company that says made in usa. I don't really care where my shoes are made

Yeah, magazine marketing is a huge blind spot for me nowadays. That "says made in USA" is certainly a theme that plays in the red market though, whether it has any factual basis or not, so if they have made a decision to target the red market I'm sure it works for them. Much like "organic" plays in many markets despite having very little in the way of specific meaning.

 

[Gori the Grey]

Are we headed towards such a chasm that companies will be forced to choose and sacrifice the part of the market they choose against?

I made this prediction early on, when right after the election, Macy's pulled Ivanka's clothing line. I'll go dig up the post. But it hasn't really panned out.

 

[TheMeInTeam]

I'm impressed by Nike having taken a proactive approach rather than just hoping they could lie under the radar playing both markets. I think they illustrated a reality that pretty much all companies if you get down to brass tacks do have a heavily skewed demographic just because there is a lot more money in the blue market than the red. If they mark the start of a trend we could see the red market more or less abandoned to products that can't compete in the blue market so have no alternative but the red market they are stuck with.

I doubt it. Even blue areas have a lot of red and vice versa, and the tribal thumping that happens every few years with fluctuating winners suggests that it might not be a good idea to isolate from either unless your product is something heavily favored by one. I wouldn't estimate shoes in that category by default, a few stereotypes aside.

 

[Timsup2nothin]

I doubt it. Even blue areas have a lot of red and vice versa, and the tribal thumping that happens every few years with fluctuating winners suggests that it might not be a good idea to isolate from either unless your product is something heavily favored by one. I wouldn't estimate shoes in that category by default, a few stereotypes aside.

I think there were some interesting statistical observations during the last election that make this argument less forceful. People who planned to vote for Trump had something close to ninety percent positives on "I don't know anyone who is voting for Hillary," and Clinton voters had a very comparable response to the analogous question. So, even though "blue areas have a lot of red and vice versa" may be true that doesn't mean that there is overlap in the markets. If I were running a sale on Nike's in my local sporting goods store I would buy ad time on channels 2, 4, and 7. If I were taking all the Nike products off the shelves "in protest" I would tip the story to channel 11, the local Fox affiliate, and hope no one else noticed.

 

[Timsup2nothin]

Interesting development from a company that basically took the point of the spear...Papa John's Pizza. They are now running an ad campaign designed to distance themselves from their founder, period. It doesn't talk about pizza, or much of anything else, it just show's employees and franchisees saying "it's more than Papa John's Pizza, it's _____'s Pizza" filling in their name. Of course they are selected to illustrate the diversity of Papa John's, and it is undoubtedly going to infuriate the right since John Schnatter has been portrayed as a folk hero who was unfairly targeted by the SJWs and had his business stolen in their echo chamber media.

Pizza is a brutally competitive business, and year to year sales dropped 6% for the second quarter, followed by 10% in July. Stock prices are off 17% in something less than a year. They are definitely wounded. The question is whether an abrupt jump to the opposite market will help more than it will hurt. Throwing away the blue market was dumb, but throwing away the red market in an effort to recover, if it doesn't work, could be fatal.

 

[Arwon]

The most woke(tm) take on this is that social justice isn't going to be sold to us by huge corporations.

Yeah but it's a pretty good sign who they think is winning, and one thing these big brands do really well is read social trends. Big evil companies can't really change anything, but they can signpost their read of what change is already happening.

That's because Kaepernick never really cared about the cause. He didn't start protesting until his NFL career was starting to fall apart and he was hoping the protesting would be a big enough publicity stunt to keep his career afloat and keep that sweet, sweet football money coming in. Since that hasn't worked, he's now taking his act to Nike simply because they are the only ones willing to offer him a paycheck. It's all about the money for Kaepernick. He doesn't give a damn about social justice or police brutality.

This is very "nothing ever really happens you sheeple" territory. It's also an incredibly convenient take if you just wanna ignore and dismiss the horrors of racialised police brutality in the United States. Just ad the hominem in the fancy shoes and pretend the whole thing is made up.

 

[Kaitzilla]

Are we headed towards such a chasm that companies will be forced to choose and sacrifice the part of the market they choose against?

Yes