The Customer is King

Of the many, many, many journalists out there who practice the craft, only a few merit inclusion in my personal pantheon of merit. This handful of writers deserves such regard for the quality of their writing and the depth of their insights. Any list of this nature must of course include Malcolm Gladwell and James Surowiecki.

This essay from James Surowiecki is another example of his talent.

• "It’s certainly true that manufacturers have a lot less pull in the marketplace than they used to. But they haven’t lost it to Wal-Mart and Target. They’ve lost it to you and me. The real transformation of the past thirty years is the rise not of the American retailer but of the American consumer",
• "Wal-Mart is often spoken of as the most powerful company in the world, but it earns less than four cents on every dollar of sales, and its profit margins have stayed roughly the same year after year—which means that when it cuts costs with suppliers it passes along those savings to the customers, instead of padding its own bottom line. Wal-Mart can’t charge more; if it does, its customers will go elsewhere", and
• "It’s getting harder and harder for manufacturers to charge premium prices for so-called premium brands. Of course, this is how it should be, according to the economics textbooks. In a genuinely competitive economy, the company that ends up selling a good is going to be the one that produces (and therefore sells) it at the lowest cost. This is a case where, as the Princeton economist Alan Blinder put it, 'the economy came to resemble the model.'"

BTW, this essay is not about Wal-Mart (although my quotes selections might lead you to think that), nor is it about the ostensible purpose behind the Procter&Gamble-Gillette merger, which is its purported topic. No, this essay is about something other.

Which is as it should be in order to be considered as among the few journalists of especial note: edifying content, depth of insights, and all told entertainingly well.