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Hoodie Billionaires: 3 Lessons We Learned from Zuckerberg's 'Hoodiegate'

August 2012 Communication

When Mark Zuckerberg showed up to a meeting with potential Wall Street investors wearing a hoodie sweatshirt, just before Facebook's initial public offering in May, analysts derided the young CEO for his lack of maturity.  Andrew Mason faced similar criticism for sipping a beer during a major employee meeting. With Zuckerberg as a cornerstone example, here are a few lessons we've learned from the minor 'scandal' analysts dubbed 'Hoodiegate.'

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Setting the Price in the Face of Competitive Substitutes – An Economics Approach

August 2012 Pricing

Economic consumer theory represents how a demander allocates consumption behavior between two goods to maximize utility under constraints such as prices, time, and income. Consumer theory rests on the simple foundation that individuals are utility maximizing entities with the driven purpose to make tradeoffs depending on preferences and constraints. In this article, Curry Hilton examines price behavior for two substitutable goods.

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According to Young & Rubicam’s BAV measures, the four pillars of brand value are Knowledge, Relevance, Esteem, and Differentiation. On which of these is your firm underperforming?

  1. Knowledgeable consumers armed with information from product reviews, existing customer’s opinions, and trial offers are eliminating asymmetric information between buyers and sellers found in the traditional markets and evolving into a segment of their own.
  2. “There is next to no evidence that corporate social responsibility (CSR) adds to a company’s bottom line”, Felix Oberholzer-Gee
  3. It once took years to build a national market.  Today’s entrepreneurs [market an app] all around the world in less than a week.
  4. Three elements that parsimoniously construct trust are Ability, Benevolence, and Integrity.
  5. An analytical economic model states the optimal price of a product facing direct competition is PN = (α · XC · PC)/ (θ · XN), that is, at the price of its competitor adjusted for relative to the value difference between the product and its competing product.
  6. Trust implies risk taking.