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INSIGHTS & JOY
A business newsletter with Pizzazz! "We help leaders become better marketersusing a holistic business approach!"
Market shifts create real progress Wal-Mart intends to lead American families to significant savings on their electricity bills. The goal is to sell at least one compact fluorescent lightbulb (CFL) to every Wal-Mart customer! A CFL is the little fluorescent bulb shaped like an ice cream cone, designed to replace our common 60 watt or 100 watt incandescent bulb. The aggressive marketing plan is one of Wal-Mart's 'green' environmentally friendly programs that makes real sense. You will want to read this month's insight to learn why you soon will be affected. Subscribe directly by e-mail to rpmorgan@morganmarketingsolutions.com and writing "subscribe" in the subject box. Check our web site for: $ Million Marketing Tips, Insights & Joy Archive, Speaker's Directory, and our Article Library! www.morganmarketingsolutions.comIN THIS ISSUEThe CFLs are coming! The CFLs are coming! Smiles make the day!$ Million Marketing TipsAmazing Facts!Marketing Facets - The Market Focused
Guide to Company Analysis
The CFLs are coming! The CFLs are coming! Wal-Mart. You may love Wal-Mart. You may hate Wal-Mart. Either way, there's no denying the tremendous market impact the company commands. Smart buying and smart marketing propelled Wal-Mart past Sears, J.C. Penny, and many other established competitors. Today, Wal-Mart is the biggest retailer in the United States. Saving energy? Now, Wal-Mart intends to lead American families to significant savings on their electricity bills. The goal is to sell at least one compact fluorescent lightbulb (CFL) to every Wal-Mart customer! That will mean an increase of 100 million CFL bulbs, doubling last year's total volume. A CFL is the little fluorescent bulb shaped like an ice cream cone, designed to replace our common 60 watt or 100 watt incandescent bulb. The aggressive marketing plan is one of Wal-Mart's 'green' environmentally friendly programs that makes real sense. A bright idea. The idea of selling more CFLs started when an associate suggested swapping out the usual bulbs in the store's ceiling fan displays. The store sold ten different fans, each with four bulbs. That alone meant changing forty bulbs in just one Wal-Mart store. At the time, there were 3,230 stores, so the idea would replace a total of 129,200 ordinary bulbs. CFLs use one-fourth as much electrical energy and last twelve times as long. Wal-Mart quickly calculated that they could save $6 million annually just changing to CFLs in their store's ceiling fan department, even when the CFLs cost 8-10 times as much! As the volume of CFLs increases, prices will drop, saving even more energy and expense for the company. Oops. Oh, okay. Wal-Mart also saw that by pushing CFLs their total lightbulb sales would ultimately decline. Customers would pay more per bulb but buy far fewer bulbs. On the other hand, by helping customers save on energy bills many of those saved dollars would come back to Wal-Mart in the form of groceries, apparel, and other customer purchases. GE's quandary. Wal-Mart's initiative put another industry giant in a bit of a bind. General Electric has about 60 percent of the lightbulb business. A major increase in CFL sales depends on GE's ability to quickly ramp up production of the odd-looking bulbs. The folks directing GE's lightbulb business also realized that a surge in CFL volume, spearheaded by Wal-Mart's marketing program, would ultimately reduce their sales of ordinary lightbulbs by a negative factor of 10-12 for every new CFL bulb sold! The GE response. Rather than fight the accelerating trend to energy-saving CFLs, General Electric has started a new initiative of their own: ecomagination. Their effort will make environmentally sustainable technologies a fast growing segment of the firm's overall business. GE's response to new technologies and changing market conditions is how they will maintain and probably increase GE's share of the evolving lighting market over the next few years. GE recognized that they needed to get out in front of the 'creative destruction' of their existing incandescent bulb market and gear up for the CFL market shift. Radial tire comparison. The move to energy-saving CFL bulbs reminds me of the gradual change from bias-ply to radial tires back in the 1970's. Michelin introduced radial tires in Europe, then imported them to the United States. They were 'different' and they cost more, so American motorists were slow to accept the radial concept. Early radial production by U.S. tire companies encountered problems, further slowing consumer acceptance. Rapid improvements in radial construction, including steel belts, finally overcame consumer inertia. Drivers recognized the radial's improved tire life and they encountered far fewer flat tires. Today, radial tires enjoy market dominance worldwide. Radials provide significant energy savings, longer life, and lower overall cost per mile. Long life radials mean fewer junk tires in landfills too. CFL savings. Compact fluorescent lightbulbs also had early technical problems that have now been solved. Consumers have been slow to understand CFL benefits or to adopt the new type bulb. CFLs provide significant savings on a family's electric bill. CFLs have a longer life, and lower overall cost per hour. CFL bulbs also reduce the number of ordinary lightbulbs pitched into landfills by about 700 million for every 100 million CFLs sold. The energy savings with 100 million CFLs is the equivalent of not burning 29,963 railcars of coal at power plants, enough to power 619,000 homes for a year. The CFLs are coming! Market shifts often create real progress. Wal-Mart, along with other major retailers, in collaboration with manufacturers like General Electric, Sylvania, and Philips are now in the process of revolutionizing the lowly lightbulb business. In the process, consumers worldwide will save billions in energy consumption while reducing waste disposal needs. Given $75 a barrel foreign crude oil, $3.00 per gallon gasoline, a positive report about CFLs on Oprah, and Wal-Mart's new program to push energy-efficient CFLs nationwide, you will soon be screwing efficient, ice cream cone-shaped lightbulbs into sockets in your own home. Note:This notable market shift is detailed in an article by Charles Fishman in Fast Company, September 2006.
Smiles
make the day! "Inside every older lady is a younger lady -- wondering what the
hell happened." Cora Harvey Armstrong "Nobody can make you feel inferior without your permission."
Eleanor Roosevelt "When women are depressed they either eat or go shopping.
Men invade another country." Elayne Boosler "I'm not going to vacuum 'til Sears makes one you can
ride on." Roseanne Barr "In politics, if you want anything said, ask a man. If
you want anything done, ask a woman." Margaret Thatcher "I'm a marvelous housekeeper. Every time I leave a man, I
keep his house." Zsa Zsa Gabor $ Million Marketing Tips TIP: Effective communication is
effective marketing. Trying to communicate too much is ineffective. One good
reason to act is better than four good reasons that confuse.
Amazing Facts! 1. Dust collected from space increases the
Earth's weight by about 6 tons per day.
2. 'Quartzy' is the highest-scoring Scrabble
word.
3. The Mills Brothers recorded about 2,250 different
songs.
4. Divide the total U.S. population by two to estimate
the number of vehicles in America!
5. John Wayne was a distant relative of Johnny
Appleseed.
6. The Golden Gate Bridge isn't golden, it's painted
"International Orange."
7. Plate glass windows and bricks are related. They are
both made of sand.
8. A roll of coins wrapped in paper is called a
"rouleau."
Marketing Facets - The Market-focused Guide to Company Analysis Marketing Facets - The Market-focused Guide to Company Analysis. Marketing Facets is a practical resource for those involved in determining the current health of a company and gauging its future prospects. I designed my 103-page guidebook to be a supplement to other evaluation procedures and information normally gathered during a thorough due diligence or business valuation process. The workbook takes a holistic approach, assembling facts and management assumptions in key areas to help analysts form and support conclusions. Marketing Facets is a valuable resource to private investment fund managers, individual investors, venture capital specialists, investment banks, and valuation specialists. Marketing Facets can also serve as a guide for C-level executives who wish to perform their own company analysis as part of normal business planning, or in advance of efforts to refinance, acquire or divest. Marketing Facets is available in electronic form via the Internet, on CD/ROM, or in print with a ring binder.> Electronic in MS Word .doc or Adobe .pdf format via the Internet @ $79.95 > CD/ROM format @ $85.95 including U.S. shipping and handling > Ring binder version and CD/ROM combo @ $99.95 including U.S. shipping and handling Consulting is also available.
Please contact me for additional information.
Telephone: 972.931.7993 Fax 972.931.0542 rpmorgan@morganmarketingsolutions.com. P.S. Ninety-five percent of our engagements originate as a referral from helpful people like you! If you know someone who:> Wants to develop a more productive
marketing program, or
> Needs help building and implementing an
effective operational business plan,
I would appreciate the opportunity to discuss the situation with you. Our ideal client is a business owner or CEO between 30 and 60+ years old. Usually with a financial, engineering, or production background. Who is often impatient, and interested in improving company performance. Comes alive when you ask, "How's business?" He, or she, is practical but also enjoys the finer things in life. So, you may see my ideal client driving a Lexus or SUV to Neiman Marcus...and to Sam's Club. Who do you know that fits this description?A client speaks: "During the past several years, I called on you to prepare detailed business overviews, year-end projections, and pro-forma forecasts. Your reports helped to better describe my company's operating results, account for the impact of product and market changes, and highlight growth opportunities. I continue to use the reviews during discussions with bankers and other interested parties. Recently, your business reviews were quite helpful as input when I commissioned a business valuation. I value your independent perspective and I will seek your objective advice in the future." Larry Kramer, Auto Designs, Inc. d/b/a Texas Auto Tops, Dallas, Texas To unsubscribe, e-mail to rpmorgan@morganmarketingsolutions.com and write "unsubscribe" in the subject box. ©2006 Morgan Marketing Solutions, Inc. All rights reserved. Other distribution permitted with proper attribution.
Richard P. Morgan CMC Telephone 972.931.7993 fax 972.931.0542 www.morganmarketingsolutions.com Author, Marketing Facets
- The Market-focused Guide to Company Analysis "We help leaders become better marketers using a holistic business approach!" CMC (Certified Management Consultant) is a mark awarded by the Institute of Management Consultants USA, and represents evidence of the highest standards of consulting and adherence to the ethical canons of the profession. Less than 1% of all consultants have achieved this level of performance and dedication. For more information go to: www.imcusa.org
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