How Companies Give Incentives

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The economic principle I examined was that people (usually) respond to incentives in predictable ways.  There are many situations where this economic principle can be applied to the real world. For instance, while studying brand names I found many examples of this principle. First, companies use certain “feelings” to incentives people to buy their products. In order for a company to make themselves a brand, they need to make their potential customer base feel a certain way. This is much more complex than it sounds, because many messages can get misconstrued. For example, a recent Dove Campaign featured three women taking off shirts the color of their skin tone. The message was that Dove can be for everyone. But because the ad was cut short it appeared that the African American women was the “dirty” version, and the white women was the “clean” version.  That is why companies need firms like those mentioned in Morgan Spurlock’s TED Talk, “The Greatest TED Talk Ever Sold”, and in my second blog post . There are business firms, like Olson Zaltman Associates, that are paid to help companies discover their brand personality by having the CEOs take personality tests, and tests on what they want their brand to mean.

This shows  that a huge incentives companies can give is simply the image they portray. Second, companies use a desired image to get you to use their products. For example, in my third blog post I talked about

Old Spice, it used to be an “old man’s” deodorant and their sales were plummeting. But, after they made a viral campaign featuring former NFL player Isaiah Mustafa telling men to "smell like a man, man" their sales went on an upward trend. This started the brand’s viral ad campaign that is still going on today. They used odd things, like slicing a basketball and a watermelon being inside, to catch the reader’s attention. That made their brand more “fun”, and therefore rose profits.  This demonstrates that if a brand can change their image into a something that many people want to have, they will incentives people to use their products.Third, companies can use a good social media presence as an incentive to use their company. For example,in my fifth blog post I talked about Dick Sporting Goods, because they have an infamous ad campaign where they showcase different stories of athletes who are wearing gear and apparel from Dick’s. They are using their social media, Instagram, Twitter, Facebook, to create a story for potential customers. This story can inspire these potential consumers, and make them associate this feeling with the company. One of Dick’s most successful ad campaigns features a picture of a hockey game, with the caption, “What are you willing to sacrifice? #WhoWillYouBe” . With a simple one line captain, Dick’s Sporting Good has shown its potential customers what their brand means. Social media allowed them to do in one Instagram post what a thirty second ad would have done, with way less production. This means that when companies can evolve with their customer base, it is an incentive for people to use their company. Overall, you can see that pricing isn’t the biggest incentive companies can use to get more customers. What is most important is the feeling that your brand imparts onto the world.