The Market Will Correct Itself

I'm sorry to admit I cannot remember who asked the question about the "helpless" consumer, at the mercy of a company extolling the virtues of its product in a blog atmosphere, during class on Monday. I do not believe, however, that an Internet savvy consumer would in fact be led like a sheep to slaughter by such a company because, especially in a volitile environment such as the Internet, the market will inevitably correct itself.

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Let's assume a situation: ACME Toy Company asks their IT department to set up a blog to promote their newest product, Spike, an interactive multimedia toy designed to teach toddlers and preschoolers about colors and shapes. Hoping to catch the attention of Gen X parents searching for information, ACME includes a post on the blog applauding Spike's ability to capture a child's imagination with his bright colors, affable charm, and the useful supportive material that accompanies the toy. Unfortunately, ACME fails to mention that Spike was secretly outsourced to China, and 3 of every 10 units will fall apart within days of purchase.

The moment Spike hits the market, he is an instant success due to the blog and an aggresive holiday-timed promotional campaign. Parents are rushing out to procure the newest gadget to help their child become a baby Einstein by New Years.

Joe Smith's son, Sammy, has asked his father for a Spike toy after playing with one at his friend Mike's home. Joe decides to do a little Internet research before making the purchase, as Spike comes at a premium. The ever-savvy blog culture, however, has caught up wth ACME's ploy with the speed that only this medium can handle. When he googles "Spike ACME," Joe encounters a blog of a parent whose child's Spike has fallen prey to shoddy manufacturing and most likely toxic materials.

Soon, post after post surfaces, complaining of Spike's obviously poor manufacturing and the screaming children he has caused. Nothing provokes a parent more than their child's dissatisfaction.

ACME soon sees its sales start to falter as more and more people hear about Spike's faults. CNN does an expose the day before the Thanksgiving holiday about Spike after one blog, parentsagainstspike.com, which has gained traction with the consumer watchdog community, demands action on the part of ACME to either recall Spike or compensate his dissatisfied customers.

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Now, obviously all market results may not be as dramatic as in the Spike example, but the blog culture is full of innovators-- people quick to purchase the newest products on the market. And they are none-too-shy about their opinions, whether they be positive or negative. The iPhone, for example, not even on the market for 3 months, already has over 185,000,000 blogs or blog entries devoted to it. Just imagine how many entries include tyrades about Apple's recent announcement to lower the price of the iPhone by $200.

Companies will certainly put lots of effort into the promotion of new products and capturing customers through the Internet market. Bloggers are becoming, in many cases, a source of product information for many consumers, and can act as promoters or deterrents. The market does indeed correct itself.

Josie Zeiger