The Marketing Power of Behavioral Economics
Behavioral economics is a useful tool to help influence (or 'Nudge') the decisions people make.
“If anything, behavioral economics impact will only grow in the future, because it works hand in glove with the growing centrality of digital solutions in marketing. You can’t understand the success of digital platforms like Amazon, Facebook, Farmville, Nike Plus, and Groupon if you don’t understand behavioral economic principles like social proof, the impact of variable intermittent social rewards, feedback loops, and scarcity. Behavioral economics will increasingly be providing the behavioral insight that drives digital strategy.”
For more, take a look at the April, 2015, article: The Marketing Power of Behavioral Economics
Generally speaking, all economists are social scientists trained to study the economic, financial, and political systems, model them, and understand how they function, should function, and could function more efficiently, identify market inefficiencies as well as how to exploit the opportunities created by those market inefficiencies.
Managerial or business economists are specialists in applied economics. They differ from other tax, legal, investment, business professionals and even other economists, in that managerial economists are uniquely educated in scientific methods to obtain relevant information, to critically evaluate and interpret information, predict the most likely resulting behavior, investment, or purchase, then to design strategies to maximize these opportunities. They take economic theory, and provide their clients with competitive advantages to improve the real world bottom line.
Standard economics assumes that people behave rationally in their own interest. e.g. as the price of something goes, up people will buy less of it. Behavioral economics tries to take into account the emotional, social and psychological factors that mean that people don't always make rational choices: for example, habit, or the behavior of the people around them.
It requires different tools to produce a net profit.
It's a greater level of competition. A more intense fight for customers. Sort of like the difference between a knife fight and a gun fight. To profit, you need a similar competitive advantage over your rivals.
There are many good options for yacht owners that are content with not making a profit from their
yachting investment. Those that are just seeking to defray some of their costs of the yachting lifestyle through minimal charter activity have many service providers from which to choose that can meet that standard.
Many of the leading yacht brokers and yacht charter brokers include basic “marketing services” now as part of their management services. There are also “marketing services” and magazines, producers of web sites, brochures, videos, yacht shows, social media and a wide range of “experts” of all types that can help promote a yacht.
However, for yacht owners that would like to get down to business - it's Corpen Communications.
First, there is the yacht owner concerned about an IRS tax audit and the possible consequences. He is taking "business tax deductions" for his yacht charter business that has not made, and will not make, substantial net after tax profits 3 out of five 5 years.
He has to do something different. He can't just keep doing the same thing, the same way, with the same people and expect different results - or expect to turn a net profit. He needs to actually make a profit - or at least begin making the necessary changes that might lead to profitability.
Second, there are the yacht owners that have never taken any yacht related "business tax" deductions, but would like to see more charter income to defray the yachting lifestyle, but without requiring additional wear and tear on their yacht. In essence, they would like to be able charter their yacht less frequently, but make more income. They would like to be able to charge more - and actually receive more for each charter.
Corpen can help both types of yacht owner.
The problem is not a lack of proper and adequate dissemination of your "marketing message" through traditional means - yacht charter lists, magazines, etc. The problem is that most yacht charter marketing messages are just not very good - or not as good as they could be.
Too often prospects never see or hear your message beause of the sheer volume of competing messages. However, even when prospects do hear your message; they are just not sufficiently motivated by what they hear to take the desired action.
Not surprisingly, very few yacht owners make marketing their charter efforts much of a priority. They don't have the time, and they surely don't have the time to regulary and timely monitor and update their marketing message. Profitable marketing is not a one time set and forget process.
Corpen can solve those problems by building upon the existing foundation of the current yacht management and marketing efforts. But by adding a new competitive advantage, we elevate the usual charter yacht from just the basic "commodity pricing structure" to premium pricing. Taking cash flow to the next level- net profits.!
Marine marketing that actually produces a consistent net profit, demands so much more than just pretty pictures and descriptive copy on a yacht broker’s web site, a brochure, magazine advertising, a video, or an occasional tweet, email, or other social exchange.
It starts with your business plan - specifically your marketing plan. So what is yours like?
This should clearly map out your financial objectives, the resources needed, and the best course to take reach those goals. Both your business and marketing plans should be annually reviewed and amended to address current problems and prepare for expected future economic conditions.
Planning for the future and determining the best course to take requires vision. Particularly long range vision. You want to see what others can't see yet, in order to position your business ahead of the competition. That's true in any business, and so it is in the yacht charter business.
Corpen can be especially helpful in this regard. It's expertise in managerial economics and behavioral economics which are keystones of modern marketing strategies provides unique insights that few if any yacht brokers, or yachting professionals could be expected to possess.
If you are a yacht owner with a yacht in charter and your existing marine marketing efforts consistently fail to produce substantial profitability, perhaps it’s time for a new direction - a course correction. A new tack may be required in order to achieve your financial objectives and get you to where you want to go – and may need to go - before the IRS inquires of your true yachting motives.
Corpen signals a new direction for yacht owners and marine professionals that expect their marketing efforts to actually enhance their bottom line net profitability. Following Corpen’s new direction can also signal to the IRS a yacht owner with a legitimate profit motive willing to make a change in search of greater profitability and not just a yacht owner with a hobby, content with annual losses as just part of the expense of enjoying the yachting lifestyle.