Compares Two Cases Of Social Experiences
The creation of markets is a complex phenomenon that requires a raft of procedures and collaboration among a wide range of stakeholders. The first step for a firm towards creating a market is to package itself to attract and retain customers by creating a unique identity. Second, the firm requires favourable regulation by the state through the creation of laws and policies. Third, the firm should identify the necessity of technology and adopt the right technology in its operations. Businesses also operate in a society and they need to create social change. This paper explores these four requirements for the market creation and asserts that a firm with a unique identity, favourable state support, right technology and a positive social impact creates and expands its market.
Role of Identity in Market Creation
Identity creates markets for an organisation by giving the products of the organisation recognisable physical aspects which attract more people to a companys products. Identity packages an organisation to communicate uniquely with the outside world. The uniqueness of communication makes the company distinct from the rest and people identify with the organisation. For example, the car enthusiasts created a market for the electric car by presenting it as a solution to the modern problems facing transport such as high costs of oil and pollution. The auto clubs also presented the electric car as highly reliable because of high hill-climbing and endurance ability. Similarly, the railroads were presented as the best means of transport to the time when other transport systems did not exist. As such, the transport system spread all over the US even in adverse conditions of civil war.
Identity makes an organisation to be associated with a unique culture. An organisation with specific basic principles and value systems on which it bases its behaviour stands out in the market. This attracts customers, hence, creating new markets. The consumers will identify a culture with a specific organisation and establish an intimate connection if the culture is favourable. For example, the automobile industry in the US was not popular until a car was presented as a necessity of modern life. The cultural perception of a car as a symbol of modern life expanded the market for automobiles. Similarly, the popularity of railroads increased because they were perceived as facilitators of national economic expansion.
Role of Law and the State In Creation Of Markets
Markets are perceived as natural products ordered spontaneously. It left uncontrolled, it will create distortions and erode their natural state. The government through legislation has the capacity to create a market. When the government of the United States passed laws licensing drivers of autonomous cars and mandating speed limits, the sale of the autonomous car increased. The state can create markets by building infrastructure that favours a particular product. For example, the demand for autonomous cars increased in the US because the state built roads for the autonomous cars. However, the actions of the government can shrink the market for a product. The political attacks of the civil wars and the great depression in the US hindered the expansion of the iron industry and the railroad.
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Role of Technology in the Economy
Technology is very significant in stimulating growth in economies that experience slow growth and increased volatility. Technology is not only a rapidly growing industry but also a catalyst for innovation and development. In the case of internet technology, about 40% of the world population is already online. Economies will bolster their competitiveness depending on how they are prepared to leverage technology.
Technology expands the size and scope of industries. In the era of horse-drawn carriages, the car making industry was small with few investors. After the improvisation of the automobiles, the industry attracted many investors including Mitchelle Wagon and standard Wheel. As the technology advanced to electric cars, the industry became widespread and spread assembly plants in many parts of the United States. The expansion boosted the economy through increasing employment. Similarly, the improvisation of steam technology in the US expanded the iron industry from an infantry stage to the setting up of vast iron plantations. The large iron industries expanded to the urban centres where they employed a large pool of available workforce.
Technology enhances the use of natural resources. Most developing countries have vast underutilised natural resources such as minerals and land. Technology can enhance the utilisation of these natural resources and increase the productivity of a country. For example, the development of technology led to the innovation of electric cars that are powered by electricity generated from water. Similarly, the iron mills used water as the source of power to run mills. The technological development enabled harnessing of natural resources in a better way to provide solutions for economic problems facing the country.
Creating Social Change and Entrepreneurship
The desire to create social change is the invention of new technologies to solve new world problems such as pollution, disease and illiteracy. In the event of creating technologies to solve these problems, the innovators create opportunities for entrepreneurship. The social entrepreneurs work with non-governmental organisations, government and the general public to get the inventions solve the intended problems.
One of the desires to create social change is offering clean water through treating wastes. This endeavour requires proper sewage treatment. The aquifers that supply clean water are mostly polluted by the absence of septic systems and sewage treatment. An individual seeking to limit this pollution may devise ways that limit contamination of ground water. An example of this innovation is South Africas Enviro Loo. This is a sealed dehydration system that dries the liquid in a collection of solid human wastes into a tap below the solid wastes. The entire liquid content is dehydrated and the solid waste is subjected to aerobic bacteria that convert the dry waste into a composite material.
The process creates entrepreneurship in various ways. All the products of the process can be put to economic use. The dried waste is free of pathogens, hence can be used as fertiliser. The liquid can be channelled to firms for absorption by plant roots. Further, the enviro Loo has been successfully installed in houses where septic systems do not work.
The desire to reduce pollution led to the improvisation of an electric car. The pioneers of this innovation established trade unions and supply and distribution channels to legitimise the electric car. This development stimulated entrepreneurship by attracting investment into complementary assets. Similarly, the United Fruit Company was conceived out of the desire to improve the nutritional lifestyle of the people. The company made bananas available to most of the consumers in the United States. The company later spread to create a national network of wholesale houses fully installed with cooling apparatus.
As explained above, market creation is an end result of a wide range of collaborations with stakeholders of an industry. Though, the initiative has to start with the individual firm. The creation of the unique culture in the electric car and railroads made the two entities created new markets by enabling their expansion. The state also made favourable regulations that enabled the use of autonomous cars. However, the political attacks shrank the expansion of the railroad. The technological information yielded positive results in the automobile industry and iron industry. Finally, the desire to create social change stimulated entrepreneurship in the electric car and United Fruit companies.