Over the past couple of weeks, there has been a dramatic fall in the once thought of, cooperate social responsible car company Volkswagen. After manipulating the pollution levels of their cars, this scandal has resulted in the German car company is facing a lot of backlash from consumers which is significantly impacting their value. This made me think of chapter two of Cocktail Party Economics as it is all about value.
Firstly, we are introduced to the idea that nothing is truly priceless even though companies try and convince us that they are. Volkswagen through catchy advertising, amazing corporate social responsibly (CSR) and environmentally friendly vehicles has built a reputation that some people would value as priceless. Especially in
…show more content…
On page 25 of Cocktail Party Economics it is explained how sports teams and players are valued. “Each team or company that employs these stars has a maximum price it is willing to pay them depending on how much it estimates the players will generate in revenue for the franchise or company” (p25) It is all about what you bring to the table. The stars talent decides their price or value. In Volkswagens case, what they brought to the table was fuel efficiency, environmentally friendly, and a responsible company, but what happens when your value is compromised? “If you have a bad season, you will be re-evaluated, so make sure to play well and not get injured. If you need a clean-cut image to be worth something in endorsements, don’t commit martial infidelity. Notice that I didn’t say don’t get caught. If you are a star, you will get caught! As Tiger Woods found out, your downfall has value in other entertainment markets, most notably the gossip tabloids.” (p25) Volkswagen, much like an athlete who has had a bad season, will be re-evaluated. Their clean-cut image of being a socially responsible company has now been tarnished much like Tiger woods when he committed marital infidelity. Tiger woods was the star of the golf world, just like how Volkswagen was the star of the car world, which is why it was just a matter of time before they were caught. This is why the value of Volkswagen cars will dramatically