Operations Management 3
Purchasing

a. The product available for purchase is a pair of Chanel shoes. There are a number of things that I would take into consideration. Buying behavior is strongly related to whether the purchase is a high-involvement purchase or a low-involvement purchase. A high involvement purchase would involve significantly more time and research than might be the case for a low involvement purchase. Therefore, the amount of research, consideration and time that one would take for this pair of shoes will be dependent on whether the consumer views this purchase as high involvement or low involvement. As Deshmukh and Das (2012) note, social class can be a determinant of consumer behavior, and a pair of Chanel shoes is definitely one of those products. For some, this is a low involvement purchase and for others a high involvement one.

For me, this purchase fits a bit in the middle. The shoes cost enough to make me pause and question if I really need them, but on the other hand, this is not something I would need to save for two years to acquire. I would definitely want these shoes to be of excellent design, shoes that I could wear to the finest occasions that I will attend, and that are versatile enough to handle a number of different situations. Ideally, this would be a purchase that will last for me for years, and they will be good enough shoes for me to wear even if I buy many other amazing pairs of shoes over the coming years. I would, however, also research the price. Not only would I try to find the design I wanted online, but also shop around a bit to get the best price that I could. Chanel shoes can be very expensive so I would definitely want to save money if it all possible – paying full price for something like this could add several hundred dollars to the purchase price, and I am pragmatic enough to avoid that if at all possible. I don’t know if I could be frivolous at any income level, because that’s just not in my nature.

So I would evaluate the Chanel shoes on the two dimensions of design and price. I assume that at the price point I’ll be paying that the shoes will be of exceptional quality. If there were any doubts on that front I would choose another brand to research that I can trust. So I am looking for a design that can take me through a number of different types of events, ideally, and probably go with a few different outfits. I want these shoes to be flashy, and attract attention, and they need to be able to do this in a variety of different settings.

I would then also evaluate the price. Of course, I have to be prepared to pay close to the full price for the shoes that I want, so this is a secondary consideration, but I also want to be able to get these shoes at a discount if at all possible, and again really just because that’s my nature to save money if I can. Why wouldn’t I want two pairs of Chanel shoes for the price of one pair? So while the price is secondary, it is still taken into account. Lastly, I also have to try the shoes on. They must fit. It is not incomprehensible to have shoes that don’t fit well if they look great, but ideally the fit has to be good enough for them to be comfortable and that I can walk in them. So that is the third factor that I will take into consideration with this purchase.

So these factors encompass search attributes, like being able to conduct the research I want to conduct, and to find the shoes I want once I decide what designs I favor. But I also want the experience of owning these shoes to be incredible, because of the investment that they represent. Credence attributes are of course would relate to the image that these shoes convey (Halton, 2019). – how I feel when I wear them and how others perceive me when I wear them. I would definitely want to portray a certain image with these shoes. Because of that, for example, I would want a design that stands out, rather than a relatively plain design. There are Chanel shoes with a plain design and those would not stand out to anybody, so I would probably look for a design that speaks for itself, and tells the world those things about me that I want my shoes to tell.



Case Study

1. Lawn Care’s current strategy is to be a premium supplier of seeds and fertilizers for lawns. The mission doesn’t seem...…also loyal and enjoy working with the company, something that cannot always be said of employees at other airlines.

Starbucks has many competitive advantages. First, it has more locations than its competitors and it almost single-handedly created the space in which it operates, giving it a better reputation than competitors like McDonalds or Dunkin Donuts have. This combination of brand power and massive number of locations makes Starbucks a formidable competitor among mainstream quick service restaurants, outperforming all over coffee competitors and taking it towards the top of the industry (QSR, 2017). Starbucks has been able to leverage its competitive advantage in coffee, for example, to expand into the retail and institutional coffee spaces, and expand into breakfast and snack food, both areas that have helped to fuel the company’s growth. Starbucks furthermore has a global scope and is listed among the world’s most valuable brands (Interbrand, 2019). Starbucks also gains competitive advantage by being able to run both company-owned stores and franchised locations, and this flexibility allows it to control market entry, and also allowed it to expand much faster than any competitor in the coffee shop business was able to do.

Apple has several competitive advantages that it utilizes. First, the company all but pioneered customer evangelism, and it benefits from this loyal fanbase to this today. This in turn allowed Apple to innovate at a rapid pace and become the leader in consumer electronics during several critical years when mobile communications were entering the mainstream. The result is that today Apple still has a decent market share in a number of products, a massive ecosystem, tens of millions of loyal customers, and beyond that, years of success have made it one of the largest companies in the world by revenue and with a massive cash stockpile that it can use to invest in any project it deems worthy. Apple’s success took some time, but they made many right moves, and today benefit from both their innovation expertise, the financial position, the marketing expertise and the power of their brand, which is today the most valuable brand in the world (Interbrand, 2019). Each of these advantages has allowed Apple to thrive – knowing it can release new products, be creative and innovative, and then also to know that it has a stable core market year over year, but also a ready market for any new products that it releases.…