Marketing frontiers

YOUR POINT OF VIEW

2006-05-22T07:38:00.000-07:00

The Barter is a new way of trade, what do you think about this way of exchange ?

The trade money is fictitious, will you become like the begining of the middle age ?

And now, tell me about your point of view.

LIMITS OF BARTER

2006-05-22T07:29:00.000-07:00

The marketing frontiers concerning barter can be approached according the universal marketing rule: “the 4P”: Price, Product, Place and Promotion. Actually we distinguish some barter limits trade.

Concerning the prices
The main frontier concerning the prices practised for bartering is about their heterogeneity.
Actually, each barter network emits its own currency and controls its circulation, which supposes that products don’t have the same exchange value according the network where they are sold. In that way, barterers are not able to compare easily the value of the goods they want to barter between different barter networks.
Moreover this type of economic operation without any monetary exchange induces some legal problems (tax problems, royalty, and so on…)

Concerning the products
Barter requires an exact coincidence of goods possessed and desired by each party for the transaction. By employing as a medium of exchange a commodity that is durable easily divisible, storable, and transportable, yet relatively scarce (such as gold or silver), trade is made vastly easier but nevertheless the availability of the required products is less obvious.

Concerning the place
Nowadays the traditional place for bartering takes place on Internet. Barter evolved much since its thousand-year-old beginnings. The reciprocal and direct exchanges being now rare, some networks exist to be used as intermediaries between their barterer. That’s why, in order to create a network which will be the only intermediary between sellers and buyers (that means all the barterers), Internet is an extremely effective tool for barter facilitating to bring closer the offer and the demand at a very low cost.

However Internet is still an unsecured tool. Many swindles take place and swindlers benefit from this weakness. In the ten last years, some barter networks misled their members. The manager of the network piled up the contributions of the members and bought their products with “barter currencies” which he emitted itself. Then he disappeared, leaving these members with some barter currencies without any value from now on.

Concerning the promotion
The main means of promotion of the barter is the “mouth with ear”. This means is very strong and gets an important strength: as soon as a network is badly managed, the news is spread quickly and the notoriety of barter network clearly falls down.

ADVANTAGES AND DRAWBACKS

2006-05-22T05:59:00.000-07:00

In todays business world, barter, one of the oldest forms of trade, has been transformed into a sophisticated way of doing business.

ADVANTAGES

- The most obvious advantage is that accommodation costs are much lower (at most networks for free) than at hotels or even youth hostels.
is the opportunity to make a personal connection with someone from a different culture and social classes, you see the destination you're visiting from a local perspective.
- Barter is an important means of trade with countries using currency that is not readily convertible.
- What barter does is help you buy products and services you otherwise might not want to buy with cash.
- Marketing Benefits Businesses are discovering that barter not only has financial advantages but it has marketing benefits as well. Barter brings in new business that could never be acquired in any other way. And as a bonus, there are no cash expenditures for this kind of marketing.
- To understand how barter works, first consider a direct barter transaction: I perform a service for you and you pay me with your product or service. This serves each of us well if each needs what the other is selling, both products are of equal value and both represent a business expense. Barter can be used as compensation, too. A company can give the bartered goods or services as a bonus or as part of a compensation packagewithout tapping cash.

For example : advantages for home exchange

- Unlimited exchange possibilities
- Personal care for pets and plants
- No hotel or rental costs
- The security of a home occupied and protected
- A wide range of destinations
- Privileged access to the local scene and culture

DRAWBACKS

- A disadvantage of using bilateral barter is that it can depend upon a mutual coincidence of wants. Before any transaction can be undertaken, each party must be able to supply something the other party demands. To overcome this mutual coincidence problem, some communities have developed a system of intermediaries who can store, trade, and warehouse commodities. However, the intermediaries often suffer from financial risk.
- But because its usually difficult to get such a matchwhere the two businesses need equal amounts of each others product the opportunities for such direct barter transactions are limited.

Barter becomes more and more difficult as people become dispossesed of the means of production of widely-needed goods. For example, if money were to be severly devalued in the United States, most people would have little of value to trade for food (since the farmer can only use so many cars, etc.)

BARTER

2006-05-22T05:38:00.000-07:00

The barter is a trade of a good without the exchange of money. The barter is not a new concept. It was the way of trading before the invention of the change. People exchanged the product of the fields and the herds for goods. This method of payment became impractical because of difficulties to transport animals or goods in remote places. To surmount these difficulties, people set up systems of payment with shells, bronze axes, jewels, bars, etc. Afterward, the change appeared.

Nowadays, the barter returns fashionably to embody a certain modernity thanks to the distances which “grew shorter” thanks to the improvement of the transports and the communication. It is an advantage for companies and citizens.

Concerning citizens, they can exchange objects, but also of time, of the mutual aid, of the knowledge, skills, from the attention to the others. Any sorts of things of the everyday life which maintain solidarities, feed networks and feed conviviality that we can call the "Live together". With the shared systems of exchange develops an invisible economy which returns big services. For the majority of them, it seemed to be interesting to observe the fact that the members of a capitalism society refuse the power of the money to return towards a king of social and historical values. Indeed, the main values of associations of citizens which make of the barter are the humanism, the conviviality, the responsibility, the transparency, the sharing and the mutual aid.

Concerning the companies, the barter has for advantage of to limit the exits of finance by paying its purchases by exchanging stored products. It is possible to generate a supplementary turnover for a reduced marginal cost and to open new outlets for its available funds. The implementations of platforms simplify the exchanges between several companies. For instance, in United States, 200 000 companies barter and realize 17 billion euros of deals every year. In Europe, the market is more limited and represents 600 million euros and 6 000 companies’ customers for about twenty platforms of barter. In France, we find 2 main platforms: Barter Forum and CoBarter.

The question is to know if the barter is going to become a real way of trading or not. We will analyse in a first the SWOT of the market of the barter. Then, in a second part, we will present a case of a company which makes barter. In a third and last part, we will underline the marketing limits.

TRADE AWAY

2006-05-18T07:45:00.000-07:00

www.tradeaway.com

Trade Away is a website where people can exchange products without money. At first, they must register themselves and propose one product in order to build their fictitious money (name Trade Credits)

Marketing point of view:
Trade Away use the community who reject the society of consumption thanks to the barter free on this website.
The consumers reject the society of consumption because they are fed up about the amount of products and the mass media. Trade Away permit at the websiters to use barter instead of money.
Trade Away is controled by the consumers, they done the work for the website. This degree of participation means that this concept is more than the e-commerce marketing where people are just spectators.

2006-05-18T04:47:00.000-07:00

creation of the blog