Chapter 1 introduces the concepts of customer value the difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits. As consumers place more value on experiences, some retailers are looking for ways to offer more than just the goods on the shelves. This article, “ Pizza, Parks, and Pet Spas: Shoppers Will Pay More for Retail Experiences, ” Bloomberg Businessweek, October 19, 2016) describes retailers that are delivering goods and experiences. Give three examples of experiential benefits that customers receive from retailers discussed in this article. How much more would you be willing to pay for each if it included each experience?
United Airlines has traditionally been a “full service” airline – targeting the middle of the market. Recently, United rolled out two additional classes of service. For those willing to pay more, United’s Polaris business class product offers spacious seats, fancy meals, a fancy lounge, and more. See an ad for Polaris below. A few months later, United introduced Basic Economy – a lower price fare without reserved seats and no carry-on bags. Basic Economy helps United battle low-cost competitors like Frontier and Spirit, which have taken market share by offering no frills and low prices. United Airlines’ CEO Oscar Munoz [Continue Reading …]
ClassPass is a startup that offers a monthly subscription service to fitness classes in more than 30 cities around the world. The company has struggled to find the “right price” for its services. ClassPass was offering a $100 per month subscription for unlimited fitness classes. This pricing, ClassPass attracted workout warriors – who got the best deal from this pricing, but their usage rate hurt ClassPass’s margins. In April 2016, ClassPass raised the price for its unlimited product to $180 – and not surprisingly lost customers. Learn more about ClassPass’s pricing issues by first reading this article at TechCrunch “ ClassPass sacrifices 10% of customers in pursuit of healthier margins, ” (September 27, [Continue Reading …]
Campus Cooks has developed a business preparing food for fraternities and sororities. This article at Bloomberg Businessweek “ Campus Cooks Aims to Supply Good Food to Greek Houses ” (May 16, 2013) shows how Bill Reeder developed this successful company. I like that the article shows how Reeder drew upon his own college experience to identify a need. This is an example of consumer needs and product/service that our students can relate to. Think about your college experience. What needs have you observed that might be filled by a creative entrepreneur?
The Hospital for Sick Children in Toronto treats kids who have cancer. The hospital has come up with a creative approach to managing the patient (customer) experience. One of the important aspects of treatment involves patients keeping a detailed “pain journal.” Kids regularly going through chemotherapy treatments often feel too tired and weak to provide that level of detail — yet more accurate journal entries can improve their treatment. Enter a technology solution — an iPhone app. You can read more at Fast Company’s Co.Create site, “ ‘Pain Squad’ Mobile App Gamifies Cancer Treatment for Sick Kids. ” The video below provides a case study overview. This example gives you [Continue Reading …]
The Virgin America press release says it best. Virgin America, the airline known for reinventing domestic travel, brings its tech and design-driven in-flight experience to life through an integrated multi-media campaign that features some of the airline’s frequent flyers. At the centerpiece of the campaign is a digital experience that brings the airline’s next generation cabins to life with cinematic flair – through the eyes of a few of its most frequent travelers. The campaign highlights Virgin America ‘Originals,’ frequent flyers known for shaking up the status quo in their own fields – including indie film director Kevin Smith, Pandora founder Tim [Continue Reading …]
The financial services industry may have identified a new and underserved target market — women. More than a quarter of all the world’s millionaires are women — and that number is growing. In the U.S., women control$8 trillion in assets with that number expected to grow to $20 trillion by 2020. This Wall Street Journal article “ Clients from Venus, ” (April 30, 2012 – non-subscribers may need to click here ) explains how women investors have different needs than men. How could a financial services firm adapt its marketing mix to better meet the needs of women? Think about the firm’s website, its advertising, and its products. Think [Continue Reading …]
Over the last decade Nike has significantly changed its marketing strategy – especially in product development and promotion. The Nike+ software and iPod partnership has the firm seeking more digital products. Nike seeks new services to enhance its offerings. My generation (I am 51) saw Nike’s great advertising on television. Now Nike has moved almost completely away from the big screen — moving to the small screens (cell phones and computers) where its core target market spends more time. There the media placement costs are very low (though production costs for thos 1-3 minute “mini movies” can be high). Fortune magazine [Continue Reading …]