studio 5: evil fall, 2009
columbia gsapp
studio tumblog
kelsey campbell-dollaghan
kdollaghan@gmail.com

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diminishing returns: the biggest problem

Diminishing Returns is at the heart of the problem for Away, P&G and other mega-corporations that sell every day products like cosmetics, soap, appliances and electronics.  The basic idea behind the Law “refers to how the marginal production of a factor of production, in contrast to the increase that would otherwise be normally expected, actually starts to progressively decrease the more of the factor are added.” Normally applied to agriculture or economics, the law can also be applied to the production and consumption of everyday products. After a certain level of global market expansion, a company will run out of market. At this point, they expand and specialize their portfolio of products - so that a women’s shampoo is now diversified into six types of women’s shampoos, along with extras like smoothing serum and defrizzer aimed at specific “hair types.” This way, consumers buy more because they “need more.”

But how far can this expansion & diversification continue? We come in contact with 20-30 brands and products during an average morning - does the strategy behind specialization have a limit to it?

And if it does have a limit - if the law of diminishing returns eventually proves to be true - what’s the next strategy for survival with these companies? How do “we” (I’m speaking at a theoretical employee) spawn new needs and insecurities in consumers, and what does that mean for the physical infrastructure of the company? Basically, what does it mean for its architecture?