Marketing Concept Essay

Summery of Articles
The Brewing Credit-Card Storm by Jessica Silver-Greenberg, Business Week May 28, 2008.
Credit card issuers have been taking financial hits lately with the weak economy; they may take another if the regulators have their way. In May, the Federal Reserve Board proposed a limit on interest rates, removing certain fees, and modify controversial billing practices. The board considers these topics “abuses”.   If these regulations would pass, profits would diminish, thus, passing along the cost to the cardholders. Kenneth Clayton, general counsel at the American Bankers Association says, “While the proposal might address certain issues, it might unintentionally create bigger problems for customers.”
“The proposed rules are intended to establish a new baseline for fairness in how credit-card plans operate,” Fed Chairman Ben Bernanke said. This plan would include banks increase the rates they charge borrowers on future purchases, but not allow rate hikes on outstanding balances. Lenders would also have to allocate payments equally to consumers’ high and low rate balances. Banks will also have to give their customers twenty one days after the bill is dispersed before assessing late charges, currently some only offer seven days.
Citigroup stated that it will probably reduce the number of teaser rates, introductory offers. Customers with bad credit will see their limits drop or be denied cards as well. “We are going to see a further tightening of credit,” says Dennis Mornoney, an analyst at consultant Tower Group. “The riskiest consumers will be hit the hardest.”
“At Best Buy, Marketing Goes Micro” by Jena McGregor, Business Week May 26, 2008
Best Buy stores are finding out how important it is to cater their stores to the society that surrounds them. A Best Buy in Baytown, Texas has seen more Eastern European workers from cargo ships shopping in their store. iPods, Apple computers, and other electronics, more expensive in Europe, are purchased in...