Instructors Manual Part II Case Solutions

Full file at http://testbankshop.eu/Consumer-Behavior-Building-Marketing-Strategy-12th-Edition-Hawkins- Solutions-Manual Instructor’s Manual

Instructor’s Manual by: David L. Mothersbaugh ([email protected]) & Integrated Solutions, LLC ([email protected]) (205) 394-4682

CASE 2-1 BMW TAPS THE EMERGING CHINESE LUXURY MARKET

1) There is often a natural tendency to assume that in collectivist cultures such as that in China, luxury products would not be popular. a) Explain how luxury products such as the BMW automobile might fulfill needs even within the traditional collectivist value set of China.

Luxury products and brands are important to consumers in both individualistic and collectivistic cultures but for different reasons as discussed in Chapter 2 and summarized in the table below.

Individualistic Culture Collectivistic Culture Reason Luxury Item is To stand out as a means of To feel a sense of Purchased self-expression membership in the group of people who have that brand

Reason for Conspicuous To convey a sense of To demonstrate in-group Consumption of Luxury individuality identity and show concern for Items group norms

Thus, when promoting products in a collectivist country such as China, marketers will often have to position the product as a path to acceptance in an in-group.

b) Explain other factors that might be driving the desire for luxury in China.

The text is also clear, however, that changes in traditional values are happening in developing countries such as China, particularly among the wealthy, young, urban set. Thus, companies can and do successfully use self-expressive and individualistic marketing messages even within China.

2) Develop a sample advertisement for BMW in China. Include the major theme, the key copy points, and the visual that you would utilize. Explain and defend your choices based on the case and materials in Chapter 2.

This question builds nicely on Question 1. Students who choose to target older wealthy Chinese should note that collectivist values are likely to dominate. Ad themes and copy points would need to reflect this value set.

Part VI 2-1 Full file at http://testbankshop.eu/Consumer-Behavior-Building-Marketing-Strategy-12th-Edition-Hawkins- Solutions-Manual

Alternatively, students who choose to target a younger upscale urban consumer may argue that individualistic values predominate. Ad themes and copy points would need to reflect this value set.

3) Growth in car ownership is expected to explode in China within the next 20 years. This will, for many Chinese, involve buying and owning a car for the very first time. In terms of adoption of innovation (see Chapter 7) for these first-time buyers: a) What type of innovation is the car for Chinese consumers who have never owned one? Explain.

Discontinuous. Because it requires major changes of significant importance to the individual or household. Owning a car requires a substantial amount of learning (driving, maintenance, to name a few) and adaption of lifestyle (driving in a car versus walking, riding a bike, taking public transportation, etc.).

b) The current car owners in China, comprising 5 percent of the population, would fall into which adoption categories?

Figure 7-9 labels the first to adopt as innovators. Students, depending on how they interpret the 5 percent figure, will likely say innovators and possibly some early adopters.

c) Analyze the likelihood that such growth can be achieved using Table 7-3 as a structure.

Students' answers will vary. The following is one example solution and is entirely subjective of the part of the author:

Nature of group 5 Given low ownership rates, the nature of the Chinese consumer group as a whole is likely to be conservative or even risk-averse to this product.

Type of decision -- The decision to purchase an automobile could be an individual or a personal decision, depending on the consumer. Marketing effort 9 BMW is a heavily-marketed and well-known brand name that stands for luxury, tradition and quality. Felt need 3 This could be a major barrier. There are many other traditional modes of transportation that the average Chinese consumer is more comfortable with. BMW may need to actually encourage “problem recognition” to spur growth. Compatibility 2 Not at all compatible for those who have never owned a car. A MAJOR barrier. Relative advantage 2 Another major hurdle. Those using more traditional modes of transportation may see more disadvantages (traffic jams, parking, driving itself) than advantages for a car in general. Complexity 1 High complexity of all the interrelated processes that must be learned is again a barrier. Observability 9 Observability is high, so this could aid in adoption. Trailability 2 Low trialability (beyond test driving) could hinder adoption. Perceived risk 2 Risks are high both financially and socially. These risks could be barriers to adoption.

d) Do you think the values and desires of later adopters in china will be different from the 5 percent who currently own cars?

The later adopters will have different values than the innovators. The first group of consumers (innovators) to adopt are generally younger, better educated, more socially mobile, and more risk-taking. The later adopters (or late majority) are older, have less social status, and are skeptical about innovations.

The case also indicates that the road systems are being put in place for more rural areas. These rural areas, though a source of potential customers, likely involve customers with more conservative and traditional values who may be harder to convince to purchase an automobile.

4) The automobile is an innovation that is not as widespread in China as in other countries. Chapter 7 discusses the innovation process and factors affecting the spread of innovations. Figures 7-7 through 7-9 give examples of various diffusion curves based on different diffusion rates. Draw two separate adoption curves, one for rural consumers, and one for urban consumers in China. Defend your answer based on demographics, values and lifestyle factors.

The rural adoption curve should be much slower than the urban adoption curve. In Figure 7- 9, the rural curve would look something like the left panel, while the urban curve would look something like the right panel. The rural consumer is less wealthy, more traditional, and likely more conservative with respect to risk taking. They may also prefer their traditional modes of transportation and be reluctant and therefore slower to adopt.

5) BMW and other foreign automakers are adapting their products to better suit the Chinese market. To what extent should BMW customize its offerings to local tastes and preferences? What are the risks of extreme customization?

Students’ answers may vary from recommending major customization to only minor customization. An argument for major customization is that China is already the biggest market for BMW. Therefore, it probably pays to make the necessary adaptations. Notice that BMW appears to think so too, since it just launched a “China only” hybrid. Some students may argue for a more conservative approach, stating concerns about other markets. In general, such concerns are warranted. However, given the size and potential of China, companies such as BMW may simply choose to make China the “norm” or make China-only models given the scale-economies such a large market can create.

6) Developing guanxi is a vital part of business in China. Using the text and case, explain how a Western company could build guanxi with its Chinese business partner.

As defined in the text, guanxi is personal connections/relationships on which an individual can draw to secure resources or advantages when doing business as well as in the course of social life. Its main characteristics are (1) the notion of a continuing reciprocal relationship over an indeﬁnite period of time, (2) favors are banked, (3) it extends beyond the relationship between two parties to include other parties within the social network (it can be transferred), (4) the relationship network is built among individuals not organizations, (5) status matters— relationships with a senior will extend to his subordinates but not vice versa, and (6) the social relationship is prior to and a prerequisite to the business relationship.

Thus, building strong interpersonal relationships based on trust is important and often requires more time to develop than in other countries or cultures. Students might note the possible legal issues around the “banking of favors.” For companies from many other countries, such “banking of favors” could be interpreted in terms of “bribes.” Care and legal counsel is necessary in navigating global relationships.

7) China is not the only Asian country with a large population that represents opportunity for new customers who have their own unique tastes. Similar to BMW Brilliance, BMW India serves the Indian market and launches certain models especially for India. Discuss factors that make India attractive to BMW. Compare and contrast India and China in terms of the key elements that BMW must address.

Clearly, like China, India is a developing East-Asian country with a large population and a growing middle and upper class. Such trends favor luxury products such as a BMW automobile. In addition, however, similar barriers such as traditional modes of transportation, poor road systems in rural areas, and so on exist.

One way to approach this is to have students attempt to gather information outside of class and do a diffusion analysis for India and then make the relevant comparisons. An element of focus should be the differential role (if it is different) of luxury automobiles in the Indian culture. Another, of course, will be language considerations. India’s education system is built around the British English system and educated Indians typically speak three languages (English for school, Hindi, the primary official language of India, and a local/regional dialect). Also, cultural differences, even for these two East-Asian countries, must be considered.

CASE 2-2 THE CREST WHITESTRIPS CHALLENGE

This case is very useful because it exposes students to, and forces them to work with, the types of demographic data that are readily available to marketers. This data is available in most university libraries and at most large ad agencies.

1) Based on Table A, describe the typical user of whiteners overall, gel whiteners, and whitener strips in one paragraph each.

Overall, the typical whitener user is female, younger, educated, professional occupation, Black or Hispanic, located in the Southeast, higher income, and single or divorced.

The typical gel user is female, younger (though somewhat older than strip users), somewhat less educated, somewhat more blue-collar though also professional, Black and to a lesser degree Hispanic, in the South, higher and lower incomes, and single or divorced.

The typical strip user is female, younger, educated, professional occupation, white, located in the Southeast and Pacific, higher income, and single.

2) Conduct an innovation analysis of Crest 3D 2 Hour Express using Table 7-3 as the basis. What insights does the innovation analysis provide into its probable sales growth?

The diffusion analysis below is entirely subjective on the part of the author. Nature of group 7 Younger consumers, as a group, tend to be more innovative, thus may be quicker to adopt new oral hygiene products. This assumes the target for this product is younger. Type of decision 9 Would involve only the purchaser. Marketing effort 7 Crest seems to own this niche and wants to hold onto it. Their resources as a P&G company should be substantial. Though the market appears to be declining, they are still investing heavily in new products and marketing. The question is, how long. Felt need 3 This will likely vary and is one of the major overall barriers – with so many products to whiten teeth besides whitener strips – including mouthwash and toothpaste; the felt need may be low which might explain the low penetration rate. Compatibility 3 Another barrier. Consumers are used to brushing, flossing, and rinsing but not putting strips in their mouths. Relative advantage 2 A problem that Crest is trying to overcome with its advertising, but not only may it be difficult with less expensive and easier to use alternatives like toothpaste with whitener, but it also may fall short perceptually to a professional treatment by a dentist. Complexity 7 Complexity is relatively low; it is just not something people are use to doing. Observability 1 Brand is not observable, nor is the type of method used. This won’t help to encourage the use of Crest or its specific strips over other methods. Trailability 2 Difficult to try a little – you use it or not. Perceived risk 7 May be lessening, but later adopters may still be concerned about damage to their teeth. This could be particularly true for this option since it is more powerful and faster acting.

3) Using demographics, describe the best target market for Crest 3D Whitestrips.

The typical strip user is female, younger, educated, professional occupation, white, located in the Southeast and Pacific, higher income, and single. This may be one ideal segment. However, students should be encouraged to think of other “attractive” segments that could be targeted if some of the barriers to adoption and use could be overcome.

4) What value does the Crest 3D 2 Hour Express tap into that its other whitener products do not? Explain.

As stated in the press release for this product, Express offers instant gratification which is the immediate gratification value discussed in Chapter 3. None of the other products offer the one-time treatment feature and require consumers to wait from 10 days to 6 weeks for full results.

5) What areas of opportunity does Table A suggest for Crest to expand the total market for whiteners beyond 15 percent of the adult market? What barriers exist to adoption of whitener products by these groups?

Lower users of strips are men, older, lower educated, blue collar, Hispanic, lower income, and widowed. Barriers include cultural (men, widowed, blue collar, Hispanic), and economic (income). Whitestrips are relatively inexpensive compared to dental treatments, but still expensive for lower income consumers. Having a strip that is lower priced could help. But cultural barriers for such groups as men, who may not feel the necessity or appropriateness of engaging in such high-end treatments and would rather opt for traditional approaches, may be more difficult challenges to overcome. Overcoming them, however, could result in stronger sales growth.

6) Which ethnic groups are more inclined to use whitener products? For each ethnic group listed, develop an advertising campaign including key positioning statement (how you want your brand to be perceived), and key advertising elements such as spokesperson, copy points, and other symbolic elements.

Overall, Blacks and to a lesser degree, Hispanics, are more likely to use whitener products. Students should utilize all the information about these ethnic subcultures in coming up with their advertising campaigns for these groups.

7) What type of reference group and reference group influence is being used by having Amanda Peet and Katie Cassidy promote the Crest 3D Whitestrips? Explain.

These are both examples of aspirational reference groups. They represent a positive, non- member, weak tie (the group being professional attractive female actresses). The type of reference group influence appears mostly to be identification. The group in this case has no way of rewarding or punishing and what appears to be the goal is to have consumers internalize the goals and values of the group, such as the importance of having beautiful white teeth.

Some students may say informational influence because actresses are professionals who count on their teeth being white and who would be seen as being relatively knowledgeable about the options out there. This would draw on their presumed expertise in the area.

8) Do an HLC analysis relating to age and household structure. What aspects emerge that help to explain why consumers of various age groups and marital status are more or less likely to use whiteners.

Single, divorced, and young trend strongly toward this product. This is when dating is common and there is a need to impress others and “look your best.” It would be interesting to see if single men were more likely users of this product than married – something this data does not allow us to examine.

Older and widowed trend away from this product. Age may engender a lack of innovativeness in this category. Dentures are also more common with aging. Also, widowed status may at least temporarily dampen the amount of socializing and thus decrease the felt need for this product.

9) What do you feel are the major barriers to growing the whitening market overall? Discuss how these might be overcome.

Various reasons may account for the decline in this market including a significant older population where dentures are more common, alternative whitener avenues in the over-the- counter (OTC) market such as toothpastes and mouthwashes that include whiteners, and the emergence of lower-priced dental procedures which are often perceived to be more effective than OTC options.

Indirectly, Crest and other oral care companies may be contributing to better hygiene and longer lasting teeth, thus overcoming the age barrier. Aging boomers are very different from their parents’ generation; and thus, may be more innovative in this category and may also be more “vain” in terms of appearance, and as a result, gravitate more toward OTC products to help them. Competition from cheaper alternatives and more expensive and better alternatives (as perceived by the customer) may be hard to overcome. The overabundance and over focus on whitening in all the oral hygiene products may make this category hard to differentiate and expand. Changing effectiveness perceptions may take more than a few simple advertisements, though product trial results reported in the ads could go a long way in increasing the credibility of those claims.

CASE 2-3 CAMRY GOES INTERACTIVE TO ATTRACT BLACK WOMEN

1) There are three types of reference group influence – informational, normative, and identification. Assuming Bianca is a representative for the group consisting of successful, urban, professional African American women, which type(s) of group influence do you see operating in this campaign?

Informational influence is a potential since a member of the target group is implicitly saying, “You are like me and I like this car, so you will too”.

Normative influence is not really being utilized in this campaign. There is no threat of punishment or promise of a reward by the group for compliance (buying the Camry).

Identification influence is likely the strongest influence being utilized. The goal here is to have the target market identify and internalize group values and beliefs and then act on them. The implicit belief is that Camry is part of an active, adventurous, urban lifestyle. Notice the strategy of showing a member of the target group using the automobile which is consistent with an identification influence strategy.

2) What are the primary core American values that this campaign is attempting to tap into?

Active (rather than passive) – the excitement and adventure aspect of the espionage theme, along with the “on-the-go” professional woman.

Change – this campaign is based on the reality of existing females and African-American professionals as role models, not stereotypes.

Individual – this campaign revolves around Bianca and her individual accomplishments.

Diversity – this campaign is reaching out to African American professional women and indicating their desire to be their car of choice.

Youth – this campaign is clearly targeting a youth audience – Bianca is a young urban professional.

3) What values and aspirations does this campaign tap into relating to the sub-groups of professional women and professional African American women?

This campaign taps into both professional women and African American women – values and aspirations relating to modern gender roles and upward mobility and status for women and blacks and so on.

4) In Chapter 5, we describe 11 African American market segments identified by Yankelovich. Which group or groups do you think the target market of professional African American women best represents? Explain.

Answers will vary here and there is no perfect match. The closest would be the female members of the Black Onliners followed by the female members of the New Middle Class.

Black Onliners come close in that they fit the age and income demographics and are tech savvy and brand conscious, which fits the description of the target professional African American women, and fits the featured aspects of the car and the Interactive nature of the campaign. While this group trends male, the female members of this group could be targeted. This group is described in the text as follows: Black Onliners (7 percent) – Younger (18-34), male, middle/upper income, brand conscious, place strongest importance on being around people of own ethnicity, most stressed about work, family, academics, and straddling black and white worlds, heaviest users of such technology as blogs and IM.

The New Middle Class is also a good match to the demographics of the target professional African American women and the tech savvy nature of this group would fit the campaign as mentioned earlier. Given the suburban nature of this group, this may be the most receptive audience to the Camry even if it never becomes truly a trend setter. This group is described in the text as follows: New Middle Class (5 percent) – Younger (25-44), highest education and income (1 in 4 earns $100k or more), most suburban, high tech use (55 hours a week Internet), positive about future, self-describe as black, feel “black slang” should be avoided. NOTE 1: Digital Networkers (female members) might be identified by some students as a good future market to begin targeting. Though a little young in some cases, they like shopping online, are tech savvy, and as they age are likely to move into the higher income category that Toyota is targeting. NOTE 2: You might also push students to identify one or more groups that are not such a good fit. There are many including “Boomer Blacks” due to the fact that they are out of the target age range, and “Sick and Stressed” who don’t match the age or income characteristic of the target group.

5) Does the target market of professional African American women fit the message and media that Camry used in this campaign? Be specific in your explanations for both message (what you thought the overall themes were) and media (what types of media such as print and Internet) they used and how they fit the target audience.

The message is that Camry fits the lifestyle of hip, urban, young professional Black women. This, according to Toyota’s research, is what needs to be conveyed since that is what this target audience wants but currently sees as lacking in the Camry.

The media are well selected – Chapter 5 notes the importance of utilizing media with an African American target audience, which Camry has done. Chapter 5 also notes that educated African Americans are among the highest users of the Internet – hence the Internet strategy fits well here also.

6) Beyond simply replacing a young white professional woman with one who is black, is this campaign at its core truly tapping into the unique cultural aspects of African American women? Explain.

Students may have different views, but the author’s view, having seen some of the episodes and viewed the site, is the level of customization is minimal beyond having an African American as a heroine and as characters in the story. Certainly urban, youth, and friendship are conveyed, but these transcend ethnicity. You might have students debate whether this level of customization is enough in this situation.

7) Why do you think Camry officials chose to try to change perceptions of their car rather than changing the car itself?

Camry has been highly successful in reaching a mass audience and leading car sales in the United States. And while it might at first seem odd that Camry tried to change perceptions rather than reality, it is worth noting that for such a “mass-market” brand, major changes to the product and product position could hurt it in the mass market. After all, the Camry has been “conservatively designed” for decades and that hasn’t stopped its market dominance. Students should be encouraged to estimate the size of the target niche here which will be considerably smaller than the 13 percent of the total population that the African American market represents.

8) Do you think this campaign succeeded in changing the perceptions of African American professional women? Explain. How might you have altered your approach to have a stronger impact?

Answers will vary here depending in part on whether they think the level of customization to African American women was enough. Students will also argue that the car hasn’t changed much if at all, so Camry is really just trying to change perceptions and not reality and that such a short-lived effort will not be able to achieve this. Students might suggest sub-models of Camry or option packages that make the Camry more exciting and also more of an ongoing campaign targeting professional African American women.

CASE 2-4 HOW SOCIAL MEDIA NEARLY BROUGHT DOWN UNITED AIRLINES

1) When Dave Carroll posted his video on YouTube, it went viral. What American value do you feel motivated consumers to pass along this “video complaint” to others?

One of the American values discussed in chapter three that applies to this situation is the value of problem-solving. Many Americans take pride in solving problems and feel that most problems can be fixed with enough persistence. After persisting in his attempts to reason with United Airlines for nine months, Carroll found another way to solve his problem: by spreading negative WOM through his online videos. Aside from finding the videos entertaining, others who viewed Carroll’s videos may have felt a sense of providing aid to Carroll in solving his problem by spreading his videos to others.

Another American value that students may mention is immediate gratification. Passing along “juicy” information may provide some influences with an immediate sense of pleasure.

2) Of the three groups of influencers identified by Forrester, which group or groups do you think were most likely responsible for Dave Carroll’s video going viral? Explain.

The group of influencers that would most likely be responsible for Carroll’s video going viral is the group in the middle of the pyramid: the Mass Influencers. This group communicates with the largest audience of viewers. Mass Influencers are not extremely motivated to spread a message, unless the message is entertaining or gossip-laden. Carroll’s video fits that description and so it spread quickly throughout social media with the help of these consumers.

3) Based on your answers to 1 and 2, develop a marketing strategy for United to “recover” from their service failure. Specifically, address the following: a) What “message” should United be sending to the general public?

United Airlines was shamed (and their stock took a dive) in response to Dave Carroll’s videos telling the world how they provide terrible service from the baggage handlers to the customer service representatives. So United should focus their message on apologizing for the failure and letting consumers know that their service will be better in the future. Consumers need to trust that United will address their issues appropriately, should any issues arise. Research suggests that apology and problem correction (in this case reimbursing Carroll for his loss) can be effective in handling a problem or failure.

b) What “media” outlets (traditional, online, social) should they be using?

Because the attack on their brand was launched via online social media, that same outlet should be one of the most heavily used in a damage control/image rebuilding campaign. However, other types of media may be used in conjunction with online social networks to reinforce the message.

c) Develop a video or ad concept that United could place on social media that could help offset consumer anger over its service failure.

Student responses will vary. However, the key is that their proposed message should be consistent with their previous answers.

d) Identify which of the three Forrester groups United should focus on with its recovery campaign and defend your answer.

Of the three Forrester groups, United should focus on the Mass Influencers because it is likely the group that spread the initial videos due to their entertainment value. So these consumers would already have an interest in United and its service. In addition, Mass Influencers create the most impressions among the general population.

4) Chapter 7 defines and discusses opinion leaders. Are the individuals that create viral complaint video opinion leaders? Why or why not?

The key aspect of opinion leaders is that they are product specific based on enduring involvement with the product category. Influencers, as discussed in this case, do not meet this criteria. They are general influencers who are interested in numerous categories of information, news, and gossip. Indeed, it appears that the “gossip” value, not enduring involvement with airlines or guitars, was the motivation behind the videos going viral.

5) Chapter 7 also discusses guiding principles that marketers should use when engaging in social media. How have United Airlines or other companies who have had similar issues operate based on these principles?

The text lists three guiding principles: transparency, being part of the community, and leveraging the unique characteristics of the venue.

Clearly, United and others who find themselves embroiled in a product or service failure situation need to clearly and honestly communicate about what went wrong and how they plan to fix it (transparency). Being part of the community can simply in these types of cases mean that the marketer “monitor” online “chatter” about the situation in order to better understand and respond to consumer reactions. It may also mean that recovery is not a one- time campaign, but an ongoing conversation about the progress being made by the company with the online community at large over time. Students will have various suggestions about the unique characteristics of each venue. Facebook fan pages offer the “wall” for posting of ongoing news items and Twitter feeds can allow the company to push their recovery message to large numbers of users quickly.

6) Several companies are using crowdsourcing as a way for customers to help solve one another's problems. How might companies harness the power of crowdsourcing to combat instances of viral negative WOM?

Companies can use crowdsourcing in multiple beneficial ways. The most relevant to this case is for companies to set up forums in which customers can seek advice from one another, provide ideas for product improvements, and provide feedback. It is important that companies monitor these forums for signs of discontent among the users and address their issues promptly before dissatisfied customers start a negative WOM campaign. Another beneficial use for crowdsourcing is to hold contests for consumer-generated advertising, which is engaging to the participants and saves the company promotional funds that would have been spent at an advertising agency.

7) Besides being a method of communication, online social networks are also innovations that are being diffused. Are online social networks continuous, dynamically continuous, or discontinuous innovations?

Students may suggest that online social networks are dynamically continuous or discontinuous innovations. Either of those options could be correct if the student gives a logical rationale.

8) Describe the typical user of each of the three social networks described in Table A.

YouTube: Users trend younger, with kids, African American, Hispanic, and Asian American, and less educated.

Twitter: Users trend female, younger, with kids, African American and Hispanic, higher income, and less educated.

Facebook: Users trend female, younger, with kids, African American, Asian, higher income, and less educated.

CASE 2-5 RICH, ANGRY BIRDS

1) The Angry Birds game is a type of innovation. a) Identify whether it is a continuous, dynamically continuous, or discontinuous innovation.

Angry Birds is a continuous innovation for consumers who already use mobile apps. On the other hand, consumers who have not yet used apps may find this to be a discontinuous innovation.

b) Conduct an innovation analysis of Angry Birds using Table 7-3 as the basis (for the purposes of analysis, focus on college students who already use mobile apps).

Students' answers will vary. The following is one example solution and is entirely subjective of the part of the author:

Nature of group 9 College students are heavy users of mobile devices and are often motivated by the entertainment value of mobility as much or more than the functionality.

Type of decision 9 The decision to download Angry Birds is an individual decision, which is conducive to the faster spread of innovations. Marketing effort 9 Angry Birds is heavily marketed which encourages diffusion. Felt need 3 With so much competition, this could be a barrier moving forward. Compatibility 8 For apps users it is very compatible. Relative advantage -- This is hard to gauge. The app seems very popular, which would suggest a perceived relative advantage. Again, competition could easily erode this advantage. Complexity 9 Low complexity – easy game to use. Observability 5 Moderate visibility, but not massively conspicuous unless the user wishes to show others. Trailability 9 Several free download versions make this very trialable. Perceived risk 9 Little or no risk – the free or nominal fee (99 cents) means that financial risk is not a concern.

2) Rovio is engaging in cause-related marketing by teaming up with BirdLife International, a nonprofit organization. How well does this cause “fit” Angry Birds? Discuss the impact that this cause-related marketing partnership could have for Angry Birds.

Students may give a variety of answers. Some students will agree that there is a good fit between Angry Birds and BirdLife International because they are both related to the fight against bird extinction and that their partnership will be mutually beneficial.

Others might think that the partnership between Rovio and BirdLife is ridiculous or a publicity stunt because Rovio is merely raising awareness, not donations. In the case of those consumers who negatively view the partnership, the efforts could actually backfire.

3) Examine the four cause-related marketing (CRM) consumer segments in Chapter 3. Detail each segment’s likely response to the CRM partnership that Angry Birds has with BirdLife International.

 Skeptics doubt the sincerity and effectiveness of CRM. So, this group would say that Rovio is not raising money for endangered birds and is only trying to get publicity and jump on the cause-related marketing bandwagon.  Balancers believe in CRM, but don’t act accordingly. So, this group would be pleased to hear that Rovio and BirdLife International are partnering for a good cause, but will not go out of their way to benefit either organization.  The attribution-oriented group is concerned behind the motives of CRM. They will evaluate what Rovio and BirdLife each have to gain from the partnership. Members of this group may conclude that Rovio may be attempting to gain awareness for Angry Birds, more so than to help BirdLife International.  The socially-concerned group is driven by their desire to help. This group will be pleased at the thought of CRM and will support both organizations, without thought to motives.

4) Angry Birds and many other apps are available in numerous countries. What are some factors that app-designers should consider when entering into a foreign market?

Students should use the factors listed at the end of Chapter 2 to answer this question. Any number of factors including unique values, needs, communication patterns, distribution networks, and affordability can come into play.

5) Angry Birds is appealing to young children because of its simplicity and cartoonish quality. Clearly, children are one of the market segments that Angry Birds is targeting. They are, or are planning such initiatives as clothing, toys, and Angry Birds Happy Meals. Chapter 6 discusses marketing to children and the consumer socialization process. What ethical concerns should Rovio consider when marketing to children?

The biggest ethical concern that Rovio should consider is that young children have a limited ability to process information and make informed decisions. Students will have various opinions of what specific practices are ethical. Some students may feel that marketing to children is unethical under any circumstances, including Happy Meals. Others may feel that there is little or nothing wrong with marketing to children and it is up to the parents of the children to watch over them and teach them how to be responsible consumers. One area of concern is in-app purchases. Parents may allow their children to play Angry Birds freely and then the children make other in-app purchases as part of the game. Unfortunately, the charges that the parents later receive are not a game. This is a ripe area for class discussion.

6) Angry Birds has been widely popular among Americans. What American values discussed in Chapter 3 help explain why Angry Birds is appealing to such a large audience? Defend your answer.

Two American values discussed in Chapter 3 apply to Angry Birds: immediate gratification and competition. Downloading and playing Angry Birds can satisfy needs for immediate gratification because it is available literally at the fingertips of consumers with touch-screen technology. Angry Birds is consistent with the American value of competition because within the game, the players compete with the egg-stealing pigs.

CASE 2-6 READY CLEATS STICK-ON GOLF CLEATS

1) What type of innovation is the REDe stick-on golf cleat? Evaluate it as an innovation using Table 7-3 as a structure.

This is probably a dynamically continuous innovation. For those who would wear the REDe Cleats instead of shoes, it requires buying the packets, sticking on the cleats in the proper places and so on. Thus, there is investment in time and effort that would not be required if golf shoes were purchased. The diffusion analysis below is entirely subjective on the part of the author. Nature of group 2 This target (golfers) are not particularly prone to change. It is steeped in tradition. However, younger golfers are more prone to change. Type of decision 8 Likely to involve only the purchaser. Marketing effort -- Uncertain given this is a relatively new company. Felt need -- Probably depends on the situation – for travel maybe high – this could be the basis of a situational-based campaign. Compatibility 2 The concept is incompatible with current attitudes and behavior, particularly of more serious players. Relative advantage 5 This depends on what dimension. On ease of use they are high. On effective traction, it is less clear and they wouldn’t likely replace metal cleats for professional golfers. Though corporate materials suggest that they are easier on the golf course than “hard cleats.” Complexity 9 Not complex to use. Observability -- Depends on the type of shoe worn – lots of styles out there mimic sneakers, so unless sole of shoe shown, may not be noticeable. Trailability 9 It is easy to have a small trial. Perceived risk 9 Very limited.

2) How can the ﬁrm use opinion leaders to help its PRO LINE Round Savers succeed?

Focus the students on developing a mass communication plan. Have them identify who the opinion leaders would be for this industry and product. Then have them discuss how they can be used. There are many different formal organizations that can be identified and leveraged in this situation.

3) How can the ﬁrm use reference group inﬂuence to help its PRO LINE Round Savers succeed?

There are numerous reference groups here. There is the aspirational group of professional players, the golf pros at a players golf club, and members of a players regular playing group. These groups will all have different influences. The professionals could serve as information and identification influence. The pros and players at a golfer’s own club could involve normative influence (chuckles and jokes made about those “funny” cleats, too cheap to buy “real” shoes, and so on).

4) What values will help this product succeed?

Active (over passive), performance (over status), change (over tradition), and individualism will all help this product.

5) Would you target professionals or amateurs? How would your approach differ between the two groups?

Professionals might be targeted, but as noted in the case they tend to use even more specialized gear. They could be a reference group if converted, but their conversion would be difficult. Amateurs would be the most likely target. With the professionals, performance would have to be the number one aspect. With amateurs such aspects as convenience, price, and comfort would all come into play.

6) What demographic groups would you target?

Golf is attracting an ever-wider demographic. However, it is still expensive to play. It might make sense to go after two demographics as follows:

First, go after the high-end golfer who travels frequently to golf. Stress the performance and convenience angle.

Second, go after the lower-income golfer who is younger and perhaps who doesn’t golf frequently and target the cost savings (versus regular shoes).

7) Develop an advertisement for REDe Golf’s PRO LINE Round Savers. Be sure to articulate the advantages of the product and also utilize reference group influence.

Strategies would vary from information laden with facts about the product and its effectiveness, ease, and comfort, to opinion-leader strategies such as a club pro making a recommendation, to informational reference group strategies such as the fact that the major regulator bodies in golf have recognized the product as acceptable.

8) How would you market the REDe Golf’s PRO LINE Round Savers in these countries? a) Japan b) European Union c) Mexico

Golf is becoming increasingly popular in Japan and Mexico and has been popular in the EU for centuries. It is important to have students recognize the standardization of marketing strategies. Can a standardized strategy be used in other countries and cultures? What factors must be adapted? Push students to develop a list of factors that would influence the success of a strategy across countries.

CASE 2-7 TIDE GOES AFTER GREEN WITH NEW PODS

1) Table 3-1 describes a green segmentation scheme of consumers that includes psychographic and demographic information. Choose four of the eight segments and describe the likely reaction that each segment will have to the introduction of Tide Pods.

 Eco-Centrists (16 percent): Highly committed to and concerned about the environment. Beliefs reflected in their consumption behaviors across a wide range of products. Will pay more for eco-friendly products. Cynical about corporate green efforts – viewed as merely marketing tactics. This group is likely to buy Tide Pods, even at a premium. But, they may question P&G’s motives behind its greener offering.

 Respectful Stewards (7 percent): Most highly concerned about environment. Beliefs reflected in their consumption behaviors. Will pay more for eco-friendly products. Not cynical about corporate green marketing efforts. This group is likely to buy Tide Pods, even at a premium.

 Proud Traditionalists (14 percent): Environmental efforts focused on keeping home running efficiently and effectively (insulation and water-efficient products). Focused on family and hard work. This group may be interested in Tide Pods because of the increased efficiently of reduced waste (water, detergent, wear on the washer).

 Frugal Earth Mothers (18 percent): Environmental efforts focused on running a more efficient home to save money (buy used, wash in cold water, air dry clothes). Focused on practicality and lowering day-to-day costs. This group may be attracted to the fact that Tide Pods waste less detergent.

 Skeptical Individuals (13 percent): Believe in environmental issues like global warming and carbon emission concerns. Skeptical of corporate green efforts. This group is likely to buy Tide Pods because of its green characteristics, but will be wary of any “greenwashing,” or deceptive environmental claims.

 Eco-Chic (14 percent): Environmentally concerned, but actions don’t match beliefs. More interested in appearing to be green to “ride the wave of environmental consciousness.” May try eco-friendly products but tend to return to their favorite non- green brands. This is not a group for Tide Pods to rely on for long-term growth.

 Green Naives (11 percent): Environmental issues have not registered with this group in terms of beliefs or actions. This group would not buy Tide Pods based on its environmental impact. However, they may be interested in other aspects of Tide Pods, such as ease of use.

 Eco-Villians (7 percent): Highly dismissive of environmental concerns. Don’t believe global warming exists. Highly suspicious of corporate green efforts and seen as marketing ploys. This group would not buy Tide Pods based on environmental impact, but other aspects such as convenience, may be appealing.

2) Chapter 7 discusses diffusion of innovations. a) Identify whether Tide Pods is a continuous, dynamically continuous, or discontinuous innovation.

Tide Pods is a continuous innovation because it requires little change in consumers’ behaviors. Instead of pouring or scooping detergent into a cup and adding it to the laundry (along with fabric softeners, etc.), consumers simply drop a small tablet into the wash.

b) Then, evaluate Tide Pods as an innovation based on Table 7-3 (use college students as the group of consumers for this example).

Students will provide various answers. The following is one example solution and is entirely subjective on the part of the author:

Nature of group 8 College students are typically more open to change and their laundry habits may not yet be well formed which is good for Tide Pods. Type of decision 9 Likely an individual decision which aids diffusion. Marketing effort 9 Heavily marketed - $150 million marketing effort. Felt need 3 Solve the “too much detergent” problem. However, consumers are often unaware of this and marketing will need to focus on creating awareness of the problem. Compatibility 7 Fairly compatible – still putting product in washer with clothes. Though some users who have well established habits of “mixing” their own solutions may find it incompatible. Relative advantage 7 Have a relative advantage due to convenient “all-in-one” formulation. Competition may erode this in the future. Complexity 9 Not complex to use. Observability 1 Low which limits diffusion rate. Trailability 9 Free samples and coupons will make this product highly triable. Perceived risk 8 Low absolute risk involved. 3) Consumer tests show that some people are reluctant to use premeasured laundry tablets because they learned to do laundry differently from their parents. a) How does this apprehensive attitude toward Tide Pods relate to the consumer socialization process discussed in Chapter 6?

During the consumer socialization process, parents are role models of consumer behavior to their children. Sometimes, parents explicitly instruct their children on how to consume products through instrumental training. Other times children learn from observing their parents through modeling. Parents can also educate their children through mediation, or altering a child’s initial interpretation of stimuli. A major part of the consumer socialization process is that parents impart consumption-related preferences to their children. The majority of Americans have grown up seeing their parents use liquid or powder detergents in the laundry, not premeasured tablets or sachets. Some parents may have specifically told their children which types of detergent are preferable. Thus, many Americans have been socialized to use detergent in a way similar to their parents.

b) Recall and discuss examples of how your family has influenced your own consumer behaviors.

Students will have a wide variety of examples of how their parents socialized them as consumers. Some popular examples are automobile brands, clothing, methods of cooking, and beauty care products.

4) Chapter 7 discusses influencers. a) Who are likely to be the influencers for Tide Pods?

Student answers may vary. However, the attributes of Tide Pods suggest several different influencers.

 The convenience aspect suggests that busy professional women might be influencers since the product provides so much value in time savings and simplicity for this task. Busy moms would also fit here due to the convenience.

 The green aspect suggests that environmentally conscious consumers might serve as influencers here as well.

b) How can P&G best target and utilize them?

If P&G can find influential bloggers (so-called “mommy bloggers” or environmental bloggers), they might use product sampling (in which case new blogger rules would apply). Other aspects might be through social media such as Twitter and Facebook.

5) How could P&G build buzz or WOM for Tide Pods?

Marketers can create buzz or WOM in many ways, such as communicating with, and giving product samples to, influencers, using product placement, getting celebrities to mention the product, and conducting guerrilla marketing campaigns such as flash mobs.

6) Using the demographic characteristics of green cleaners listed in the case develop a marketing campaign including (a) core theme, (b) body copy, (c) key visual aspects, and (d) media considerations for one or more target groups.

Answers will vary depending on the target group. The key is that all aspects of the campaign tie into the selected group. For example, if it is households with children, the convenience theme may be appropriate, along with a visual of a mom or dad overwhelmed with daily tasks using the Tide Pods to make laundry a snap. If targeting one of the ethnic groups, considerations of cultural heritage and values as well as language (Hispanics) need to be addressed.

CASE 2-8 TAPPING THE ETHNIC HOUSING MARKET

Questions 3 and 4 could be the basis of a longer term project. 1) What are the opportunities and challenges facing housing lenders and real estate agents across ethnic subcultures? Opportunities include the fact that while there are some common motivations across ethnic subcultures in terms of why people want to purchase a home (e.g., good place to raise and educate children, paying rent is bad). The fact that there are also different motivations can also be an opportunity for those realtors and lending agencies who understand and market to those differences (e.g., owning a home as a signal of status, as a good retirement investment). Also the size, growth, and purchasing power of the various ethnic subcultures are increasing which represents an opportunity within these markets. Challenges include (a) language – in the case of Spanish Hispanics, (b) lower knowledge levels, (c) anxiety about the buying process, and so on. The differences in underlying motives for buying a house could also be seen as a challenge to those realtors and lenders who are unwilling or unable to adjust their products, services, and marketing messages across ethnic subcultures. 2) Based on the information in Tables A, B, and C develop an overall marketing strategy for targeting each of the following groups: a) African Americans b) English Hispanics c) Spanish Hispanics This is an interesting and useful exercise. Students should be encouraged to combine information from Chapter 5 along with information in the tables to identify core marketing strategy issues, opportunities, and challenges across the ethnic subcultures. 3) Based on the information in Tables A, B, and C develop advertising campaigns including (i) overall positioning strategy and core theme, (ii) key advertising copy points, (iii) visual elements, and (iv) key media outlets for: a) African Americans b) English Hispanics c) Spanish Hispanics This is an interesting and useful exercise. Students should be encouraged to combine information from Chapter 5 along with information in the tables to identify core marketing strategy issues, opportunities, and challenges across the ethnic subcultures.

Clearly core themes for African Americans and Hispanics can focus on some common themes such as “good investment,” “live in community that shares my values,” and “symbol of success.” Some differences include the fact that African Americans are less motivated than are Hispanics by convenient location to work, family, and friends, and a home as a good place to raise/educate your kids. Having some key core values may help the general themes to be similar in many cases across African Americans and Hispanics. However, the execution of these themes will require adaptation in terms of such things as ethnicity of the spokesperson, country-of-origin for Hispanics, language for Hispanics, media outlets, and so on. 4) Based on the information in Tables A, B, and C develop training materials for lenders and real estate agents to enhance their interactions with consumers from various ethnic backgrounds. Analyze lenders and real estate agents separately and develop materials relating to both verbal (written and oral) and nonverbal communication. This can drive interesting and useful discussions relating to the communications challenges across ethnic subcultures (both verbal and nonverbal) and how these issues then can be incorporated into training materials. Analyzing lenders and real estate agents separately requires them to consider the specific dynamics involved in those separate aspects of the home-buying process and the unique challenges and opportunities facing each based on the case information. You might encourage students to interview the owners or managers of local real estate companies or banks who target various ethnic subcultures, when possible, as a way to gain specific insights into the opportunities and challenges involved.

Part VI 2-24