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Title: Monthly Newsletter Presentation

1
Monthly Newsletter Presentation

October 2009

Quick Links

Article Abstracts
Commercials
Videos

2
Article Index

Who is Wearing the Power? (Chapter 1, 4, 5, 8,
12)
Phone Wars (Chapter 2, 7, 8, 11)
Alice Takes Care of Everyone (Chapter 2, 11, 17,
18)
Private Labels to Impress NYC (Chapter 5, 9, 10,
13)
Want a Video with that Yoohoo? (Chapter 2, 8, 14)
Asda Asks for Customers Opinions (Chapter 5, 7,
9, 14)
Twittering the Latest News (Chapter 10, 12, 17,
18)
The Gatorade Flop-Sweats (Chapter 1, 2, 11, 17)
Is There Room For One More? (Chapter 2, 13, 16,
19)
Nothing to Wear? (Chapter 4, 5, 10, 16)
Product Placement on HSN (Chapter 2, 16, 17, 18)
Starbucks in Just Seconds (Chapter 2, 4, 8, 11,
13)
Localized Pricing (Chapter 14, 15, 16)

3
Video Index

Gilt.com (Chapters 4, 10, 17)
Audi (Chapters 6, 10)
My Macys (Chapters 9, 16)
Hermes (Chapters 7, 10, 13)

4
Commercials Index

Mac v. PC (Chapters 2, 18)
GameStop (Chapters 4, 5, 16)
Wendys (Chapter 10)
iPhone (Chapters 10, 17, 18)

5
Who Is Wearing the Power?

Retailers of clothing for teens formerly targeted
their marketing efforts toward kids rather than
their parents.
For example, Abercrombie Fitch and Hollister
stores play loud music and set the mood with dark
lighting.
Some retailers now believe teenagers have less
purchasing power as their parents discretionary
income decreases, so they are targeting parents
instead.
For example, Aeropostales new campaign is called
TTM, or Target the Mom.
Buckles has even adjusted store hours to
accommodate parents schedules better.

6
What Do You Think?

Is it short-sighted of retailers to change their
focus and attempt to please parents?
Is it a mistake for AF and Hollister to ignore
the changing economic picture?

7
Phone Wars

Nokia created the worlds first smartphone, but
the development of the iPhone and Blackberry have
overtaken the clout of Nokias version.
Although iPhone and Blackberry dominate in the
United States, there are many emerging markets in
which Nokia remains dominant and has a golden
opportunity to deliver smartphones.
Nokia already holds a 60 percent market share in
India.
Emerging markets like Latin America, Asia, and
India do not need the best smartphone a
mid-range smartphone at a lower price has greater
value for these customers.

8
What Do You Think?

Assess Nokias market position in North America.
Provide a brief SWOT analysis of Nokia.

9
Alice Takes Care of Everyone

Alice.com sells household items such as bath
tissue and Clorox wipes online.
Consumers who buy their household items from
Alice.com do not have to remember to pick up
these basics when visiting the grocery store.
The site helps consumers budget, as well as
reminds them when they need to reorder.
Consumer packaged goods (CPG) companies have
partnered with Alice.com to send targeted samples
to their customers.
The CPG companies can now measure, more quickly
and accurately, which consumers respond to a
promotion.

Alice Web site
10
What Do You Think?

How is Alice.com leveraging customer data?
Would Alice.coms business model
work in product categories other
than CPG?

11
Private Labels to Impress NYC

Duane Reade, the 256-store, New York-based chain,
is revamping its private-label products.
Private-label branded products are developed and
managed by the retailer.
Its new brand, DR Delish, offers a wide variety
of products, including fresh sandwiches, salads,
and fruits, that are similar in quality to
national brands.

Duane Reades Web site
12
What Do You Think?

Why is Duane Reade developing private-label
products?
What other products might Duane Reade offer under
its private label?

13
Want a Video with that Yoohoo?

Redbox is a vending machine-style rental kiosk
for DVD movies, located in grocery stores and
McDonalds restaurants.
There are already 15,600 Redbox kiosks in the
United States that rent approximately 7.5 million
movies weekly.
The rental fee is 1 per day.
The target market for Redbox is lower-income
households with larger families, which is not the
primary market for Blockbuster or Netflix.

Redboxs Web site
14
What Do You Think?

Who will be most successful in the DVD rental
market Blockbuster, Redbox, or Netflix? Why?
How might Netflix and Redbox use STP to enhance
their sales and profits?

15
Asda Asks for Customers Opinions

Asda, the discount department store in the United
Kingdom, is conducting a 18,000-customer focus
group, called the Pulse of the Nation.
Customers give their input about new products
that Asda might carry.
Asda listens to customers but also realizes that
they do not always tell the complete truth.
For example, customers may claim they only eat
fruits and vegetables, when in fact, if given the
chance, they will make an impulsive chocolate bar
purchase.

16
What Do You Think?

What do you think of Asdas move to get customers
involved in buying decisions?
What opportunities do you see from online
consumer panels for this and other functions?

17
Twittering the Latest News

Small companies utilize Twitter to send out
announcements about promotions or new products.
It is an inexpensive marketing tool.
Large companies utilize Twitter to maintain
personal contacts with their customers. They can
respond to a specific customer complaint
instantly.
Social media allow customers to stay engaged with
a brand they allow companies to listen to their
customers.

18
What Do You Think?

How are retailers using Twitter and Facebook to
communicate with their customers?
Why arent these social network tools reaching
all potential customers?

19
The Gatorade Flop-Sweats

Gatorade has been performing poorly after Pepsi,
its parent company, undertook a rebranding effort
that renamed the drink just G.
The Whats G? campaign appeared successful
after its introduction during the Super Bowl
tremendous buzz was created due to curiosity
about what G really was.
Gatorade maintains a 75 percent market share in
the sports drink category, but this share is
decreasing.
Now, Gatorade is going back to its core and
targeting customers who work out and are thirsty
for a sports drink.

Gatorades Web site
20
What Do You Think?

Was it a good idea for Pepsi to tinker with an
established market leader?
If the size of the sport drink market continues
to decline, what options does Pepsi have to
improve sales of Gatorade?

21
Is There Room for One More?

Walmart and Best Buy are trying to capture every
customer shopping for electronics, but HHGregg, a
118-store chain, is growing quickly to capture
customers who once shopped at the now bankrupt
Circuit City chain.
HHGregg sells more expensive models in an upscale
environment.
Salespeople undergo 280 hours of training in
their first year.
HHGreggs gross margins are higher than Best
Buys, but the chain has had to bring in some
less expensive products, like video game
consoles, to maintain its sales in the current
economic environment.

HHGreggs Web site
22
What Do You Think?

How does HHGregg differ from Best Buy?
What theories suggest HHGregg might succeed?
Which ones imply it might fail?

23
Nothing to Wear?

In this economy, consumers are buying accessories
such as belts, bags, and jewelry to spice up
their wardrobes.
Apparel retailers are focusing on their
accessories, such as by opening stand-alone
stores.
Accessories achieve approximately double the
profit margin that apparel does they also take
up much less space in a store.

24
What Do You Think?

When was the last time you purchased a new item
of clothing?
Why might one accessory-only store fail while
another, seemingly similar one succeed?

25
Product Placement on HSN

HSN, the home shopping network, does not sell
traditional advertising in the form of
commercials. However, it will start selling
advertising in the form of product placements.
For example, the chef Jamie Oliver will make a
pasta dish using Barilla pasta with the brand
displaying on the screen. He will also mention
the positive benefits of the product such as
multigrain and a great source of protein.
Product placement is a type of paid advertising
that viewers cannot fast forward through, because
it is integrated into the TV content that they
have chosen to watch.

HSNs Web site
26
What Do You Think?

Why is HSN adding product placements of brands
into its programming?
Are product placements on HSN different than
those on other networks? If so, how?

27
Starbucks in Just Seconds

Starbucks is introducing a new instant coffee,
Via.
The Via instant coffee packets will allow more
coffee drinkers to enjoy Starbucks coffee without
paying premium prices.
Via will compete with Nescafe.
Customers may prefer Via because it reminds them
of being in a Starbucks store.

Starbucks Vias Web site
28
What Do You Think?

Do you think Starbucks regular clientele will be
willing to try Via?
What impact will Via have on other Starbucks
products?

29
Localized Pricing

National retailers are pricing and marking down
product prices according to the unique demands of
their different markets.
For example, New York City exerts different
demands than Kansas City.
A Banana Republic store in the World Financial
Center in New York offered a skirt for 39.99,
marked down from 69. At the SoHo store, a few
blocks away, the same skirt was 33.99.
By marking down products based on local demand
and inventory levels, the company can maximize
its profit margins.
Swimsuits might be marked down in Maine in the
winter, but in Florida, they would remain full
price.