Friday, December 17, 2004


Product differentiation

So today I stopped into the corner bookstore (B&N) to get what I thought was my one remaining Christmas Present (I completely forgot that there were two other books I was supposed to pick up for the twins...arghhh) and I wrote a check. Only I wrote the check for Borders instead of Barnes and Nobel. So this got me to thinking. I had no idea which of these stores I was in so do Barnes and Nobel or Borders have any product differentiation to speak of? Yes, I know they each have their own little discount cards and promotions...but fundamentally I am wondering about whether or not they can hope to engender "brand loyalty." If not, why do they invest in donating to charities or for that matter allowing vagrants like myself to sit there reading stuff I have no intention of buying? The vagrancy has multiple explanations really, but I felt I should cop to my vagrancy. The investment in it's "image" through charitable contributions is harder to explain.

I have one theory involving lawsuits. They want to be able to present themselves well if they get sued for something...aka the Phillip Morris marketing strategy. I'm sure there are competing explanations, but I can't justify the economic theory of "warm glow altruism" in this instance precisely because of the size of these companies.

As a side question though...since B&N and Borders are virtually indistinguishable, does anyone see a merger occurring in an attempt to concentrate market share creating greater market power and possibly benefiting from economies of scale on an even larger scope than they currently have? If not, why not? Would a merger cause the two companies to fall into the sights of the Antitrust department? Are there any economies of scale to be exploited or are they at the point of diseconomies of scale setting in? Granted as a consumer I probably benefit from the existence of two separate companies, but I'm just spitballing here.

Okay...a bunch of other questions are also flying through my mind about the product differentation angle. Is one of the companies piggybacking off of the other? Could brand loyalty be cultivated in a book store at all? If so, how? Is any advertising done by the establishments a waste?

Now for why I am really posting all of point out how sad it is that the bulk of my night will be spent obsessing over these questions in between rejections at the local clubs from blondes.

P.S. One of the books I looked at in the bookstore was on how to get dates. It was for both men and women. The number of Rules for a guy to get a woman? 10. The number for a woman to get a man? 2. The saddest part is that I think they were stretching it with two on should have just been one.

The book also perpetuated the myth that attractive women are sitting home lonely and wishing they had a guy on a Friday/Saturday night. I can state emphatically that this is a myth. The idea that men don't approach attractive women "out of their league" is a total lie. I do it daily. Daily I get told they are seeing someone/married/lesbian/leaving the country/not really there and I'm imagining them. If an attractive woman is home alone and doesn't want to be it isn't because guys weren't approaching is because she said no to all of them. I wish people would stop with that ridiculous lie as it is so blatantly foolish.


It's interesting that Wal-Mart advertises itself as "the only place you have to go", except if you want a copy of Jenna Jameson's book. Wal-Mart won't even sell it with a big smiley-face wrapped around it.
So it's off to the Mall we go to Barnes and Noble and Borders with more appreciation for what they do for us.
Steve Lee
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