Textbook Capitalism

trickle down cartoon If you want to understand how the world really works, corporate marketers are a far better source than mainstream economists. The latter, of course, have long insisted that capitalism is the ultimate expression and accommodation of human reason. At the level of theorizing individual behavior, that still-regnant claim rests on the homo economicus axiom, which insists (invariably without serious examination of relevant evidence) that ordinary people are, first and foremost, walking calculators.

Here, meanwhile, is what those who are in charge of actually selling actual capitalist products have to say on this topic:

Experiences shape how consumers feel about brands, including factors such as service, quality of products and amenities.

Advertising has always needed to appeal to consumers’ emotions as the most rudimentary form of engagement, and that has not changed.

Emotions actually play a more significant role in purchase behavior than price and convenience…

There’s a point at which a customer’s positive or negative experience is so strong that it can transcend the rational aspects of a brand (e.g., quality, price, service). That’s why creating and guiding the customer experience is so important. Experience creates emotion, emotion fuels engagement and both together impact brand and business outcomes. [Source: adage.com, March 4, 2015]

Not exactly textbook material, is it?

Modern Investment

diab-pepsi As we TCTers know, Pepsico has been on a special mission to further boost its shareholders’ take from its operations. How do they do this? Why, by boosting and refining their investments, of course.

And what, precisely, does “investment” mean, in our age, at a mature profit demesne such as Pepsico? Marketing, of course.

Per Advertising Age:

Wondering if advertising works? Just ask Pepsico.

PepsiCo declared it would boost advertising spending across key brands, trim agency partners in the North America Beverage division and better leverage its global scale — while cutting costs and enhancing shareholder returns. The company is making progress, according to data from several sources, including PepsiCo’s annual financial report released last week. And importantly, when it comes to marketing, PepsiCo has put its money where its mouth is.

Hugh Johnston, PepsiCo’s chief financial officer, said the company has “absolutely” accomplished what it set out to in 2012 and is seeing improved brand-equity scores and an upward trend in market share.

PepsiCo increased measured-media spending in the U.S. by 24%, or nearly $130 million, in the first three quarters of 2012, compared with the same period in 2011, according to Kantar Media.

PepsiCo reported a 4% drop in full-year profits in part due to increased marketing spending. But fourth-quarter profit rose 17% as the spending kicked in. Pepsi also posted 5% organic revenue growth for the quarter and year.

“We not only stepped up the level of investment in advertising and marketing, but we took steps to improve its efficiency and effectiveness by better leveraging our global scale and driving consistent brand positioning and coordinating advertising, creative and production activities,” said Indra Nooyi, chairman-CEO of PepsiCo, on a call with analysts.

Clearly, all this is something only the magic of the private sector could accomplish. How very lucky we all are!

The TCT Diagnosis

bray What’s happening? The unacknowledged but totally real, labor-theory-of-value vindicating end of the Reagan Experiment. That’s what.

All sponsored by the vicious, genocidal, ultra-stupid American ruling class and managed by both wings of its purchased two-partied duopoly, in this market-totalitarian society, all formally presided over by a whored-out fool who makes Stepin Fetchit look like an amateur at the trade. Not a pretty picture…not a happy future.

What is Capitalism?

enjoy_capitalismCapitalism is an inherently expanding social order in which the goals and powers of profit-seeking, wages-for-worktime-paying private investors are the most important force shaping society.

Capitalists hate free markets, which force them to pass along technological advances in the form of lower prices.  To protect themselves from that, in the late 1800s, leading capitalists lobbied state legislatures in the USA to win the right to form the giant conglomerate corporations that have since been the major units of the system.  Thomas Edison explained this to The New York Times in February 1892, when he was merging Edison Electric with rival Thomson-Houston Electric to form General Electric.

Capitalism presumes that Earth can sustain endless economic expansion and whatever level of resource consumption that may require.