Video Case Teaching Notes

Video Case Chapter 1 – Zappos

Running timeIntro: 1:44Problem: 1:25Solution: 3:10Total: 6:21

Video Summary

These days, online retailers are a dime a dozen. But in a short period of time, Zappos has become a billion dollar retailer. How did it hit the dot-com jackpot? By providing some of the best service available anywhere. Zappos customers are showered with such perks as free shipping both ways, surprise upgrades to overnight service, a 365-day return policy, and a call center that is always open. Customers are also delighted by employees who are empowered to spontaneously hand out rewards based on unique needs.

With such attention to customer service, it’s no surprise that Zappos has an almost cult-like following of repeat customers. But remaining committed to the philosophy that the customer is always right can be challenging. This video highlights some of the dilemmas that can arise from a operating within a highly customer-centric strategy. Zappos also demonstrates the ultimate rewards they receive from keeping that commitment.

Questions and Answers1. Describe Zappos’ market offering.

According to the text, a market offering is “some combination of products, services, information, or experiences offered to a market to satisfy a need or want.” Students can easily identify the combination of products that Zappos offers that include shoes, clothing, handbags & accessories, beauty items, eyewear, sporting goods, and many other categories of retail items. However, students should be challenged to identify the rest of the Zappos’ package. This could include: Services – online shopping, 24-hour customer service, free shipping both

ways. Information – detailed product descriptions with 360 degree views and video,

brand and company information, product reviews and ratings. Experience – this revolves around the nature of Zappos customer service

culture. Every customer can speak directly with a person who treats you like an old friend. The online interface is easy to use and customizable. Zappos interacts with customers in a very personal way when customers log-in to the Web page, through email, and through social media.

2. What is Zappos’ value proposition? How does it relate to its market offering?Providing the best selection and the best service for any category of retail goods.

3. How does Zappos build long-term customer relationships?

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While this video is brief, it gives a nice peak inside of the culture at Zappos. The company starts by recruiting and training only people that will be truly customer-oriented employees, regardless of their job title. Every employee is trained in Zappos’ ten core values. Through this, the old cliché that “The customer is always right” is truly believed, practiced, and lived by Zappos employees. The case study in this video is a perfect example of that. Zappos did not have to honor the error in price for all the customers who purchased the shoes in question. In fact, there are few companies that would have. And likely, there are few customers who would have held it against Zappos. Zappos also could have not honored the price, but offered the customer in question some other bonus ($20 off on the next order, free shoe laces, etc.) that wouldn’t cost the company so much. But Zappos truly chose to go above and beyond. To do so when it didn’t have to is the mark of a truly customer-centric company.

Teaching Ideas

The video case for Zappos follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. As this video pertains to Chapter 1, this segment could be used to illustrate customer needs, customer experience, customer value, market offering, value proposition, and others.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. In this Zappos video, students can assume the challenge of realistically dealing with a price markdown that was a mistake and led to a huge financial loss.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Focus should be given to Zappos’ actions that are true to its philosophy of building customer relationships. Discussion should bring out the tradeoff between saving money (even when a company is legally entitled to it) and the benefit of long-term loyal customers.


Video Case Chapter 2 – OXO


Video Summary

You might know OXO for its well-designed, ergonomic kitchen gadgets. But OXO’s expertise at creating hand-held tools that look great and work well has led it to expand into products for bathrooms, garages, offices, babies’ rooms, and even medicine cabinets. In the past, this award-winning manufacturer has managed to move its products into almost every home in the United States by relying on a consistent and in some cases non-traditional marketing strategy.

But in a highly competitive and turbulent market, OXO has focused on evaluating and modifying its marketing strategy in order to grow the brand. This video demonstrates how OXO is using strategic planning to ensure that its marketing strategy results in the best marketing mix for the best and most profitable customers.

Questions and Answers1. What is OXO’s mission?

“To create innovative consumer products that make everyday living easier.”

2. What are some of the market conditions that have led OXO to re-evaluate its marketing strategy? At the core of OXO’s origins is the concept that kitchen and household gadgets were not designed ergonomically with ease-of-use in mind. This was particular the case for people with dexterity issues (elderly, people with arthritis, people with disabilities). During the 1980s, this population of people was on the rise.

It was also apparent to OXO’s founders that kitchen and household gadgets were generally very plain, not created with style or home décor in mind. During the 1980s, the trend toward bigger, fancier kitchens was also on the rise.

OXO’s original strategy was to create products that would take the gadget market in new directions as far as appealing to the real needs of real users such as those mentioned above. But it also had to consider at some point that it could not branch out and re-create new products for all the different segments it was targeting (tots, as well as home décor conscious and those with dexterity issues). Its size as a smaller company as well as its desire to grow combined with those market conditions to create the need to focus on universal design.


3. How has OXO modified its marketing mix? Are these changes in line with its mission? Product – Universal design is very much a product development concept. OXO has focused on making each product (or the technology in each product) usable across multiple product categories and customer segments. Packaging is also oriented around this as Alex Lee describes how a single product might be packaged in various ways with different OXO brands on the label, but the device just says OXO.Price – not discussed in this video. Place – OXO products are widely distributed through national discount retailers (Target, Wal-mart) as well as through specialty stores (Williams-Sonoma, Staples, Babies-R-Us) in order to reach every customer segment. Promotion – not discussed in this video. See the OXO video for chapter 12 on its promotional strategy.

Teaching Ideas

The video case for OXO follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. For chapter two specifically, this segment may be used to highlight concepts like mission statement, marketing strategy, and SWOT.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. This segment can be used to highlight market segmentation and market targeting as OXO executives discuss the challenges of continually producing innovative products for multiple segments in small markets.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. The OXO video is a great example of a company that has built a core competency (universal design) around its mission in order to confront the challenges that it faces.


Video Case Chapter 3 – Ecoist


Video Summary

At least one company has taken the old phrase, “One man’s trash is another man’s treasure” and turned it in to a business model. Ecoist is a company that uses discarded packaging materials from multinational brands like Coca-Cola, Frito-Lay, Disney, and Mars to craft high-end handbags that would thrill even the most discriminating fashionistas.

When the company first started in 2004, consumer perceptions of goods made from recycled materials weren’t very positive. This video describes how Ecoist found opportunity in a growing wave of environmentalism. Not only does Ecoist capitalize on low cost materials and the brand images of some of the world’s major brands, it comes out smelling like a rose as it saves tons of trash from landfills.

Questions and Answers

1. How engaged was Ecoist in analyzing the marketing environment before it launched its first company?Based on the information given in this video, the analysis of the marketing environment by Ecoist has been done on a small scale, informal level. The video describes how the company got started and how it continues as a small company. They do not have the budget to invest in the kind of environmental analysis that requires research.

That said, just about everything this company has done has revolved around consideration of the marketing environment. Its founders were very aware of problems associated with waste. They were also aware of issues oriented around artisans in other countries not making a fair wage. It was their knowledge of these issues that turned on the light bulb for Jonathan Marcoschamer when he first saw a handbag made from recycled trash.

2. What trends in the marketing environment have contributed to the success of Ecoist? Cultural - without a doubt, the biggest trend that has fueled Ecoist’s success is the growing importance consumers have placed on environmental issues and social responsibility. As Mr. Marcoschamer states, when they first started, it was very hard to sell retailers on the idea of a quality, fashionable handbag made from recycled materials. Now, that concept is very hot. Ecoist has ridden (and


maybe even helped to fuel) that trend. This trend applies not only to customers, but to companies. It seems likely that more and more companies would be interested in working with Ecoist to help recycle their waste. Economic – This may be a factor in companies wanting to sell their waste materials to Ecoist. It’s a small amount, but still may help a company that is struggling to cut costs in hard economic times. Economic conditions have also helped Ecoist to hone its product portfolio and pricing structure so that their products cover a range of prices and are affordable to more people. Technological – Ecoist has discovered ways to more efficiently use recycled materials in the construction of its goods.

3. Is Ecoist’s strategy more about recycling or about creating value for customers? Explain. Ecoist is a great example of a company that understands that it is possible to “do well by doing good.” Indeed, Mr. Marcoschamer states that Ecoist’s mission is to be “a leading lifestyle brand that provides goods and services that are good for people, the planet, and the bottom line.” Certainly, this is a company started by people who care about social issues. But from the beginning, they had an eye toward helping those issues by succeeding in business. Ecoist has focused on producing goods that customers really want while they help “save the planet.” A good example of this customer value is how Ecoist has been able to convince major retailers that there is a big benefit in the variation of its products. While retailers typically want large batches of identical products, Ecoist churns out batches of “one of a kind” products; each one is just a bit different than the others. Especially for people who are fashion conscious, this is a huge plus.

Teaching Ideas

The video case for Ecoist follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. With respect to chapter 3, the introduction can be used to illustrate how the company got its start because of certain trends in the macroenvironment.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. How does a new


company get off the ground when it is trying to sell a product made from unconventional materials? That is a question that has as much to do with the trends in the marketing environment as it has to do with company strategy.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This segment illustrates how Ecoist has confronted its challenges by communicating the benefits of sustainability and fair trade and an overall eco-image.

Video Case Chapter 4 – Domino’s


Video Summary

As a delivery company, no one delivers better than Domino’s. Its reputation for hot pizza in 30 minutes or less is ingrained in customer’s minds. But not long ago, Domino’s began hearing its customers talking about how its pizza was horrible. As a company that has long focused on solid marketing intelligence to make decisions, Domino’s went to work on how it could change consumer perceptions about its pizza.

Through marketing research techniques, Domino’s soon realized that it had to take a very risky step and completely recreate the pizza that it had been selling for over 40 years. This video illustrates how research not only enabled Domino’s to come up with a winning recipe, but it led to a successful promotional campaign that has made fans of Domino’s pizza in addition to its delivery service.


1. Explain the role that marketing research played in the creation and launch of Domino’s new pizza. Domino’s was a company that was successful for decades. It took a decline in sales and market share for it to realize something was wrong. Marketing research was completely responsible for discovering why the company was suffering. Not only did research identify that the quality of Domino’s pizza was the main reason for its decline, but it was used in every step of the creation and launch of the new pizza.

Defining the problem – research clearly identified that customers did not like Domino’s core product. It wasn’t just an issue of having a product that didn’t excel. It was that customers thought its pizza was disgusting. It also identified


Domino’s biggest strength – delivery and customer service. Product development – Domino’s approached the process of re-formulating its pizza in a very methodical way, one that could be evaluated and analyzed so as to come up with the best possible combination. It started with dozens of options for crust, cheese, sauce, and other ingredients. Using the research process, it whittled those options down to its “top five.” Concept/product testing – Domino’s utilized an experimental design that tested certain combinations, and extrapolated predictions for other combinations that weren’t tested. Launch/promotion – Domino’s used data and material from its research to develop a ground breaking promotional campaign based on honesty and transparency. “Our pizza stunk” was at the core of its promotion.

2. Are there more effective ways that Domino’s could have gone about its research process? There may very well be. But based on the information in this video, it seems that Domino’s was extremely focused on the research process throughout the entire process. As Russell Weiner states, Domino’s “wants to be able to establish with a certain amount of statistical confidence that X-Y-Z is going to work.”

3. Why did it take so long for Domino’s to realize that customers didn’t like its pizza? Was it an accident that it made this realization? In all likelihood, it was because they weren’t forced to confront the issue. Domino’s shot to the top based on a strategy of “30 minutes fast or free.” Its popularity skyrocketed because people loved the idea of being able to get hot pizza fast – and the possibility of getting the pizza for free if it wasn’t. No one (customers included) paid much attention to the quality of the pizza. Once the market caught up to it in terms of competitive options, people found that they could get good service elsewhere and get better pizza. Thus, it was hardly accidental. It was the most real problem of “losing sales” that woke Domino’s up.

Teaching Ideas

The video case for Domino’s follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The Domino’s video introduction section highlights chapter 4 concepts like test marketing.


2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. The problem section of this Domino’s video illustrates a nightmare of a problem for any company: customers can’t stand the core product.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This final section walks students through different types of marketing research and applies them to the new product development process, culminating in a successful product and launch.

Video Case Chapter 5 – Goodwill


Video Summary

Since 1902, Goodwill Industries has funded job training and placement programs through its chain of thrift stores. While selling used clothing, furniture, and other items may not seem like big business, for Goodwill, it amounts to over $3 billion in annual sales. You might think of thrift stores as musty, low-class operations. But Goodwill is putting an end to such perceptions by focusing on concepts of consumer behavior.

Like any good marketing company, Goodwill recognizes that not all customers are the same. This video demonstrates how Goodwill caters to different types of customers by recognizing the cultural, social, personal, and psychological factors that affect how customers make buying decisions. In this manner, Goodwill is able to maximize customer value by offering the right mix of goods at unbeatable bargains.


1. Describe different types of Goodwill customers. The video addresses the following types of customers:

2. Which of the four sets of factors affecting consumer behavior do you believe most strongly affects consumers’ purchase decisions from Goodwill?


Answers to this question will vary. There is some support for each of the four: Cultural – The video addresses this based on location of stores. The culture (including subculture and social class) of each neighborhood varies considerably. This affects the types of things people donate as well as the types of things people shop for. Social – Social values affect the manner in which people view thrift stores. Personal - Factors such as lifestyle, personality, and economic situation have a huge effect on how people shop for clothes and general merchandise. Goodwill has learned that it isn’t just low-income people who shop for used merchandise at thrift stores. Psychological – Beliefs, attitudes, perceptions, and motivations affect the value the different customers apply to the same item.

3. How does Goodwill’s recognition of consumer behavior principles affect its marketing mix?In response to the different categories of factors that affect consumer behavior, Goodwill has made the following adjustments to its marketing mix: Cultural – Inventory varies from store to store in an effort to bring the right kind of product to the right kind of customer. Social – Goodwill has created a tier of outlets including Goodwill Boutiques and regular Goodwill stores with lower prices and more general merchandise. Goodwill moves product around to different stores if it doesn’t sell in one store. It ultimately ends up at a Goodwill outlet store. Personal – Timing. More current fashions hit the boutiques or cutting edge stores in higher-end neighborhoods first. As fashions and trends fade out, those products hit stores that cater to people in a lower socio-economic class. Psychological – Goodwill not only moves product around, but has a pricing strategy that caters to the customer perception of value. When products first hit the shelves, it is priced at a set level. Higher-end items in high-end stores have even a higher price. Then, the longer an item sits on the rack, the more its price is reduced. At some point, there is something for everyone.

Teaching Ideas

The video case for Goodwill follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction section of this video not only gives a general introduction to this


company; it identifies that there is much more to this thrift store chain than most consumers typically attribute to this category of retailers.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. The problem of this section illustrate how economic conditions as well as changes in technology affect the consumer circumstances. In this case, Goodwill has faced the challenges of both keeping customer donations up as well as retail sales.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Goodwill has recognized the differences in consumers, based on the factors affecting consumer behavior, as a means of keeping its chain relevant, even as times change.

Video Case Chapter 6Eaton

Location: Cleveland, Ohio


Video SummaryWith approximately 70,000 employees in more than 150 countries and annual

revenues of nearly $12 billion, Eaton is one of the world’s largest suppliers of diversified industrial goods. Eaton has been known for products that make cars peppier and 18-wheelers safer to drive. But a recent restructuring has made Eaton a powerhouse in the growing field of power management. In short, Eaton is making electrical, hydraulic, and mechanical power systems more accessible and more efficient to its global customers. But Eaton isn’t successful only because of the products and services that it sells. It is successful because it works closely with its business customers to help them solve their problems and create better products and services of their own. Eaton is known for high-quality, dependable customer service and product support. In this manner, Eaton builds strong relationships with its clients. After viewing the video featuring Eaton, answer the following questions about the company.

Questions and Answers1. What is Eaton’s value proposition?


This may be a challenging question for students to answer. Certainly there are things mentioned in the video like the fact that Easton is a brand trusted for quality. Eaton is also known as a company that partners with customers to help them solve their problems. But the focus of this case is on how Eaton has shifted with the times to position itself as a power management company. The value of Eaton is that it enables companies to be more efficient and reliable with respect to power needs.

2. Who are Eaton’s customers? Describe Eaton’s customer relationships. Eaton markets to sophisticated, discriminating customers. But the full answer to this question should revolve around the concept of the buying center in the text. The buying center establishes that there are various individuals and even departments within companies that have a vested interest in any given purchase. These include influencers, users, buyers, deciders, and gatekeepers:

Engineers who are designing things Operations people who are running things. General managers who are focused on the broader scope of value that can

be added.

The video specifically addresses the strength that Eaton has in managing relationships with its customers. One of the principle aspects of this is that Eaton has a competency in resolving situations that go wrong. Customers come to trust Eaton as it reacts in ways that demonstrate that it has the best interest of the customer in mind.

Most important to its ability to develop and maintain customer relationships is the fact that Eaton focuses on partnering with its clients. As the video points out, “Our reputation is growing in terms of not just our ability to solve typical applications, but our ability to solve applications that are very demanding.”

The challenges of the recession highlighted in the challenge segment of the video highlights demanding, complex needs of industrial clients. Eaton got right on it and determined what had changed with respect to each customer’s needs. It determined what challenges each company was facing. Then, it went to work to helps resolve those problems and help each client succeed at fulfilling the needs of their customers.

3. Discuss the different ways that Eaton provides value beyond which customers can provide for themselves. Eaton’s success depends on its ability to provide high quality, dependable customer service and product support. Through service and support, Eaton develops a clear understanding of consumer needs and builds stronger relationships with clients, and helps add value to its products. Some of the specific ways that Eaton adds value as per the video are as follows:


Eaton has gone from component provider to solutions provider. Eaton works multiple levels of channels that interact with each other. Eaton solves problems for its customers by solving problems for the end customer.

The customer knows what’s needed, Eaton knows what’s possible. Eaton has expertise that its customer do not have and shares it.

Eaton recognizes that it cannot sell the same product every year. It has to be innovative, be worth paying a price for.

Teaching IdeasGive students two minutes to list all of the business-to-business marketers they can recall. Give them an additional two minutes to list all of the business-to-consumer marketers they can. Chances are, the list of b-to-c marketers is considerably longer. Do any marketers make both lists? Ask students to think about the enormity of the b-to-b market as compared to the b-to-c market. Why aren’t they more aware of b-to-b marketers?

The video case for Eaton follows the most current format for videos in the Pearson Video Library. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem.

Video Case Chapter 7 – Boston Harbor Cruises



Video Summary

Since 1926, Boston Harbor Cruises has been providing customers with memorable experiences on ocean-going vessels in and around the Boston area. But these days, the term “cruise” has different meanings to four-generation family business. To thrive in strong economic times and in bad, Boston Harbor Cruises has progressively targeted various types of customers with its different boats and different services.

Sight-seeing trips around Boston Harbor, whale-watching tours, fast ferry service to Cape Cod, dinner and wedding cruises, and a high-speed thrill ride are among Boston Harbor Cruises offerings. It even offers commuter services and off-shore construction support. Targeting this diverse customer base has become even more challenging as Boston Harbor Cruises has further differentiated the market into local customers, domestic vacationers, and international travelers.


1. On what main variables had Boston Harbor Cruises focused in segmenting its markets? Initially, Boston Harbor approached the market from a “local” perspective. It had many different cruise services for various customer segments. And it certainly catered to customer differences with those different services (commuter ferries, whale watching tours, thrill ride, historic tours, dinner tours). But it considered all those customers as “local” in that they all came to Boston and used the service there. This is evident in how Alison Nolan tells of the company’s former practice of advertising in the Boston yellow pages, the local Boston newspapers, and by putting promotional materials in Boston hotels.

2. Which target marketing strategy best describes Boston Harbor Cruises efforts? Support your choice.Differentiated – Boston Harbor Cruises clearly “targets several market segments and designs separate offers for each.” Boston Harbor Cruises has taken this to a new level by recognizing the differences between local, U.S. tourists, and international tourists.

3. How does Boston Harbor Cruises use the concepts of differentiation and positioning to build relationships with the right customers?Boston Harbor Cruises has identified different customer segments. It has also identified the unique needs of those segments. It should be noted and discussed that Boston Harbor Cruises has identified how fluctuations in the economy affect consumer needs. As the largest private fleet of ocean going vessels, Boston Harbor Cruises has a lot of boats that serve a lot of purposes. It has catered these services to the needs of different customers.

The biggest way that Boston Harbor Cruises has changed its positioning strategy is by adjusting its promotional strategy. In down times, it knows that it has a


better market among international travelers. As a result, it has increased online efforts as well as increasing its budget that focuses on foreign travels partners.

Teaching Ideas

The video case for Boston Harbor Cruises follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction of this video makes it very clear that Boston Harbor Cruises targets various customer segments with different services.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. This solution segment identifies the effects of the economy on the demand emanating from different customer segments.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Boston Harbor Cruises has made a very simply shift – allocate promotional dollars to the segments where demand is greatest.

Video Case Chapter 8 – Life Is Good Running time

Intro: 1:32Problem: 2:13Solution: 3:52Total: 7:41

Video Summary

You’re probably familiar with Life Is Good. The company’s cheerful logo is prominently featured on everything from t-shirts to dog collars and seems to exude a positive vibe. While this company has found considerable success in selling its wares


based on a happy brand image, consumers aren’t getting the complete image that Life is Good founders intended. This video illustrates the challenges a company faces in balancing the role of the customer and the role of the company in determining meaning of a brand.


1. What are people buying when they purchase a Life Is Good product?This should be relatively simple. While Life Is Good sells apparel, that is not what customers are buying. Even though there is a relatively high perceived quality in Life is Good’s products. People can get t-shirts – even high quality t-shirts with catchy graphics – from numerous companies. Bert Jacobs spells it out: optimism. The company doesn’t really care about clothing. It cares far more about selling a perspective and selling its Playmaker Foundation.

2. What factors have contributed to the Life Is Good brand image? Certainly, the founders had a great deal to do with this. Bert Jacobs describes the evolution of “Jake.” It came out of the desire to oppose all the negative messages that come through the media. But it took off because Bert and his brother hit on the fact that they weren’t the only ones who were craving a message of optimism.

3. What recommendations would you make to Life Is Good regarding brand development strategies? Obviously, the big issue for Life Is Good is expanding the image of the brand so that people recognize that Life Is Good is about the Playmaker Foundation just as much as it is about the message of optimism. Student responses to this will vary. But they should recognize that Life Is Good has this objective and that it is already employing the following strategies to better communicate the aspects of the brand that it wants to disseminate: Hang tags on all products Life Is Good Web site Facebook Festivals E-mail blasts Tour with the Life Is Good trailer and team Making more opportunities to donate to Playmakers

Teaching Ideas

The video case for Life Is Good follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.


1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction of this Life Is Good video clearly illustrates not only the origins of the company, but how the brand image revolves around the concept of optimism.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. In this video, students are shown that while Life Is Good has had a very successful run and a strong brand image, that image doesn’t capture what the founders had hoped for – an understanding that the company is more about Playmakers than it is about selling clothes or even optimism.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Life Is Good has expanded the strategies that it uses to drive home the aspects of its image that it wants consumers to be aware of.

Video Case Chapter 9 – Subaru Running time

Intro: 1:14Problem: 2:24Solution: 3:12Total: 6:52

Video Summary

When a company has a winning product, it has it made. Or does it? Subaru is a winning company (one of the few automotive companies to sustain growth and profits in hard economic times) with various winning products, including the Impreza, Legacy, Forester, and Outback. But what happens when any one product starts to decline in popularity?

This video demonstrates how Subaru constantly engages in new product development as part of its efforts to manage the product life cycle for each of its models. Subaru is focused on both developing the next version of each existing model and developing possible new models to boost its product portfolio.



1. Discuss the product life cycle in relation to one Subaru product.Students could pick any of the products illustrated in this video. Here is one example based on the Outback:

a. Introduction – the introduction of SUVs really dates back to the pre-war era with the first Chevrolet Suburban (1936). This was followed throughout the decades with early Jeeps, International Scouts, and Ford Broncos.

b. Growth – as David Sullivan explained, the supply and demand of SUVs was increasing rapidly in the early 1990s. While Subaru had marketed four-wheel drive sedans and wagons for years, it didn’t have anything that really qualified as an SUV. So, it lifted its Legacy sedan and wagon, beefed up the suspension, put meatier tires on it, and the Outback was born. Many consider the introduction of the Outback in 1995 as the introduction of an entirely new product category, crossover SUVs or CUVs.

c. Maturity – Today’s Outback is in the maturity phase as a fourth-generation vehicle. It is important to note that the entire category of CUVs is mature (SUVs have been in decline for a number of years now). When a company’s most popular product starts to taper off, it must move forward with new products. Subaru has recognized this. They are not a company that is totally rooted in SUVs. When customers began abandoning SUVs, companies like Ford and Chevrolet were in big trouble. Subaru has a unique relationship between its CUVs and non-CUVs. As the demand for the CUV version fluctuates, the demand for its non-CUV counterpart picks up the slack (Outback and Legacy are largely the same vehicle). Subaru has also developed itself in the market of high-performance sedans (WRX) and full-sized CUVs (Tribeca).

d. Decline – None of Subaru’s vehicle models seem to be in a true decline phase. This is what they hope to prevent. But they are preparing for such by creating other models.

2. How do shifting consumer trends affect Subaru’s products? The shifting trends towards SUVs and CUVs is a case-in-point. The Outback was born from a necessity for Subaru to have a product that could compete with other manufacturers producing vehicles catering to this growing trend. As the trend increased and CUVs took on a life of their own, Subaru was well-poised with a leading product. As larger, truck-based SUVs started to decline, Outback (at its sibling the Forester) met consumer desires for a beefy all-wheel drive vehicle that was more car-like and more fuel-efficient.

3. Describe how Subaru remains customer oriented in its new product efforts. Explain.Research. The collect data from customer letters and phone calls. They do dedicated research through means like ethnographic studies. They have gone in to


peoples homes to observe how they live and what needs they have in their vehicles. From this, they have identified various new product features such as more comfort and convenience features and more rear-seat legroom.

Teaching Ideas

The video case for Subaru follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction segment for this Subaru video not only illustrates the Subaru is a company with many different products, but that it is engaged in trying to meet consumer needs with new products as trends shift.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. This segment illustrates the challenges that emerge when top product hit maturity.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. New products do not necessarily mean “completely new” concepts. Modifications and updates are new products. This segment shows how Subaru is very focused on both.

Video Case Chapter 10SmashBurger

Location: Denver, CO

Running time: Intro: 1:46Problem: 1:27Solution: 4:07Total: 7:20


Video Summary

Hamburgers are America’s favorite food. Consumers spend more than $100 billion on the beef sandwiches every year. But despite America’s infatuation with burgers, there is considerable dissatisfaction among consumers based on hamburger quality and value. Many customers just aren’t happy with what is served up at market-leading fast-food outlets. They want a better burger, and they won’t hesitate to pay a higher price to get one. Enter Smashburger. Started just a few years ago in Denver, Colorado, Smashburger is now a rapidly expanding chain of more than 100 stores in 17 states. And all this growth happened during a severe economic downturn despite Smashburger’s average lunch check of $8. Many customers pay as much as $10 or $12 for a burger, fries, and shake. The Smashburger video shows how this small startup has pulled off a seemingly impossible challenge.

Questions and Answers1. Discuss the three major pricing strategies in relation to Smashburger.

Which of these three do you think is the company’s core strategic strategy?

2. What effect does Smashburger’s premium price have on consumer perceptions? How did a restaurant with a premium-priced product and little track record take off during a recession? The video specifically addresses the challenge of launching this chain of restaurants right as the global recession took hold. But Smashburger found that the importance of providing a higher quality burger at a premium price didn’t change with economic conditions. In fact, the economy had the effect of getting people to downgrade from restaurants like P.F. Chang’s or Applebee’s, places where they would spend $12 or $13 or more on a meal. The public perception with Smashburger’s premium price was that they could have “fast” food, but still have a quality meal in an attractive environment.

This is what led Smashburger to find its optimal price point of about $8 (average). They had a recipe and speed on their side. The price was the feature that cinched the deal for the market.

Also, Smashburger’s ala carte approach communicated more flexibility to consumers. People could go in and spend only $5 on a very filling burger. Or, they could opt for whatever side dishes and drinks that they wanted.

3. Is Smashburger’s success based on novelty alone or will it continue to succeed?It would seem that Smashburger has a formula that has staying power. Again, this concept was developed prior to the great recession. It rolled out amidst horrible economic conditions and it works. As the economy improves, it will have an established base of customers, and people with


more money in their pockets will trade up from regular fast food for something better.

Teaching IdeasThe video case for Smashburger follows the most current format for videos in the Pearson Video Library. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem.

Video Case Chapter 11 – Hammerpress


Video Summary

Printing paper goods may not sound like the best business to get into these days. But Hammerpress is a company that is carving out a niche in this old industry. And they’re doing it by returning to old technology. Today’s printing firms use computer-driven graphic design techniques and printing processes. But Hammerpress creates greeting cards, calendars, and business cards that are hand-crafted by professional artists and printed using traditional letterpress technology.

When it comes to competing, this presents both opportunities and challenges. While Hammerpress’s products certainly stand out as works of art, the cost for producing such goods is considerably higher than the industry average. This video illustrates how


Hammerpress employs dynamic pricing techniques in order to meet the needs of various customer segments and thrive in a competitive environment.


1. How does Hammerpress employ the concept of dynamic pricing?The text defines dynamic pricing as “adjusting prices continually to meet the characteristics and needs of individual customers and situations.” The nature of Hammerpress’ customer base and its product types are a perfect match for dynamic pricing. Hammerpress doesn’t just change its prices around on the same exact product. It creates packages and options. A great example of this is the concert promotion posters. If a producer wants to pay the price that will cover the costs of the product and provide Hammerpress with a reasonable margin, they can do that. But knowing that concert promoters are often working form a tight budget (and delayed cash flow), Hammerpress also offers the option of paying a lower price if it can retain the rights to sell copies of the posters.

2. Discuss the three major pricing strategies in relation to Hammerpress. Which of these three do you think is the company’s core strategic strategy?Cost-based pricing – it seems that Hammerpress primarily relies on this method of designing the product, adding up the costs, and adding in a margin. This is the main method for the industry. Customer value-based pricing – Hammerpress is a good example of a company that is primarily cost-based, but still considers customer value. The example given of movie posters is one such illustration. However, so is the example of printing the bread bags for Whole Foods. They were uncertain about the cost structure of that new job. So they worked on the expectations of the customer by stating that the price of future jobs might vary. They still used a cost-based model for both of these examples. But they made modifications based on perceptions of customer value. Competition-based pricing – Because Hammerpress is so unique, it does not have to compete on price like other computer-based services do. For many of them, the market may establish the price entirely. But Hammerpress has some flexibility due to the process and quality of its work.

3. Does it make sense for Hammerpress to compete in product categories where the market dictates a price that is not profitable for the company? Explain. Yes. Brady was very smart to create a by-product pricing option by giving some customers the option of paying a lower price in exchange for releasing the rights of the design to Hammerpress so that they can sell copies. This is a benefit associated with certain kinds of products. And because Hammerpress works with a more artistic and high-quality method, they can do this where many of their competitors might not be able to.


Teaching Ideas

The video case for Hammerpress follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction of this Hammerpress video gives details on the uniqueness of the company’s products. This sets up the basis for pricing strategy.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. Hammerpress works in an industry that is largely driven by competition-based pricing. Modern computer-based printing services all churn out the same stuff. So, they have a commodity product. Hammerpress’s challenge is based on communicating the differences in its products that merit high prices based on higher cost.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Hammerpress is successful at working through a cost-based pricing system by knowing and understanding the different needs of its different types of customers. It employs dynamic pricing as a means of adjusting price to appeal to different needs.

Video Case Chapter 12 – Gaviña Gourmet Coffee


Video Summary

These days, there seems to be plenty of coffee to go around. So how does a small time coffee roaster like Gaviña make it in an industry dominated by big players? By


carefully crafting a distribution strategy that moves its products into the hands of consumers.

Without a big advertising budget, Gaviña has creatively pursued channel partners in the grocery, restaurant, and hospitality industries. Now, major chains like McDonald’s and Publix make Gaviña’s coffees available to the public. This video also illustrates the impact of distribution strategy on supply chain and product development issues.


1. Apply the concept of the supply chain to Gaviña.As a manufacturer, Gaviña relies on suppliers of its core ingredients to produce quality products at prices that won’t break its bank. What this video doesn’t show is the efforts that Gaviña has gone to in order to create a reliable supply chain for high-quality coffee beans that are rooted in fair trade practices. What the video does show is just how much the fluctuating price of the coffee commodity affects the way it does business.

2. Sketch out as many consumer and business channels for Gaviña as you can. How does each of these channels meet distinct customer needs? It should be noted that all of Gaviña’s channels ultimately end with the consumer. However, there are many end-users who do not realize that they are drinking a Gaviña product. This is because they are purchasing the coffee by the cup through one of Gaviña’s institutional customers.

Consumer (retail) channelsGaviña Costco end-userGaviña Kroger (and all other grocery stores) end-userGaviña Liborios (chain catering to Hispanics) end-user

Institutional (wholesale) channelsGaviña McDonald’s end-userGaviña Donut shops (and other small food service accounts) end-userGaviña Wholesaler Donut shops (and other food service accounts) end-userGaviña Wholesaler Office coffee services end-user

3. How has Gaviña’s distribution strategy affected its product mix? The video clearly identifies various channels that Gaviña uses to distribute its product. This multi-channel strategy has had a big impact on how Gaviña’s product mix has evolved. For example, it develops and distributes private label goods for retailers like McDonald’s and small shops. It has its core brand, Don Francisco, that it distributes through grocery stores. It developed Don Francisco Family Reserve for that channel to answer the demand for a premium coffee customer can brew at home. As it entered the club store channel with Costco, it developed José, a proprietary premium brand for that retailer. For the channels that distribute to ethnic customers, the brand Café la Llave is the product.


Teaching Ideas

The video case for Gaviña follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction segment of this video sets the stage for distribution concepts and Gaviña’s distribution strategy.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. This segment illustrates the challenges faced by a small but growing company. In particular, it is apparent from this discussion that Gaviña is a company that prides itself on quality. And as the pressures of increasing costs take their toll, Gaviña will not compromise its quality like so many others do.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This final segment illustrates how a company can overcome competitive forces with a savvy distribution strategy. Not only has Gaviña gone in to multiple distribution channels with various brands, it has also capitalized on its product quality while emphasizing building relationships with its business customers.

Video Case Chapter 13 – Home Shopping Network


Video Summary

Shopping on television has been around almost as long as television itself. But the Home Shopping Network (HSN) made it a full-time endeavor in 1982, giving birth to a


new retail outlet. Since then, HSN has been a pioneer in products, presentation, and order taking. The company has sold millions of products and has been known for giving an outlet to legitimate products that otherwise would not reach customers.

But what does a company do when the very retail channel that it depends upon starts to fizzle out? This video illustrates how HSN has met the challenges of a changing marketplace to continue its innovative methods for reaching its customer base.


1. How has HSN differentiated itself from other retailers through each element of the retail marketing mix? Product and service assortment – HSN certainly has a variety of products for sale. As the video mentions, some of those products are HSN exclusives which is a point of differentiation. However, the greatest point of differentiation that HSN has from other retailers – even online retailers – is that it is not just a retail outlet. It is a form of entertainment. So, as consumers shop, they are watching a television program. People become involved with and attached to the shows and hosts, just as they would with other television programs. Pricing – not discussed in this video. Promotion – HSN has the unique characteristic of crossing the boundaries between these elements of the marketing mix. HSN’s programs are part of the product. They are also a major means of promoting the goods sold. The concept of “boundaryless retail” takes promotional efforts online to its Web site and to its mobile interface. Distribution – Goods are shipped directly to consumers, just as they are with catalogue or online retailers. But HSN’s distribution is more specifically through its programming and other media interfaces. There is a fine line here between distribution and promotion. But because HSN’s product is as much programming as it is the actual goods that are sold, those programs are distributed through Television and not to some extent through online and mobile channels.

2. Discuss the concept of the retail life cycle as it relates to HSN. Similar to the product life cycle, retail outlets also go through a life cycle. HSN describes the origins of the television shopping outlet as it pioneered the concept in the late 1970s and early 1980s. At that time, the concept was rough and undeveloped. Over time, HSN has improved the quality of its programming, improved the quality and variety of its catalogue of products, brought in various celebrities, created dedicated programs for hosts and celebrities, and many other elements that have increased the status (not to mention the cost) of HSN as a retail outlet. More recently, HSN has moved into multiple channels. In certain respects, this is an example of a retailer embracing new retail outlets (online and mobile) as those outlets begin and move through the retail life cycle.

3. Do you think HSN has a bright future? Why or why not? Student answers will vary to this. It is always difficult to predict. However, any answer to this must be rooted in the very problem that is expressed in the video.


There are a ton of options for entertainment as well as shopping. Those options will only increase. HSN must continue to offer value to consumers that they can’t get elsewhere. So, if consumers want to watch because they don’t just get shopping options, they get all that expertise and suggested advice on how to use products, they’ll keep watching. But if consumers find that either those things are not important, or they can get those same benefits in a better way through other channels (including online), then they won’t watch. It must be noted that the average HSN shopper is older and that younger demographics are not flocking to the network. HSN must find a way to connect with younger audiences or it will eventually die out.

Teaching Ideas

The video case for HSN follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. In this segment, it is apparent that there is far more to HSN than most people realize.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. HSN’s problem of facing a fragmented landscape of television programming options is real and it has been going on for the past few decades. It is only compounded by newer competition in the online realm.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. In this segment, HSN illustrates how it has kept and increased its viewership over the years. It isn’t just out to sell. It is out to entertain.

Video Case Chapter 14 – OXO

Running timeIntro: 0:57Problem: 2:21


Solution: 3:38Total: 6:57

Video Summary

For over 20 years, OXO has put its well-known kitchen gadgets into almost every home in the United States through word-of-mouth, product placement, and other forms of non-traditional promotional techniques. While OXO is a leading national brand, it competes in product categories that are small in size. With its tight advertising budgets, mass-media promotions are not feasible.

This video demonstrates how OXO is moving forward with its promotional mix through online and social media campaigns. For its Good Grips, SteeL, Candela, Tot, and Staples/OXO brands, OXO is making extensive use of the major social networks, expanding into the blogosphere, developing online ad campaigns, and more.

After viewing the video featuring OXO, answer the following questions:


1. Why has OXO chosen to change its promotional strategy at this time? As CEO Alex Lee points out, there is not return on investment with traditional mass-media advertising for OXO. They need to make more efficient use of their promotional dollars. Social media provide for that. Also, there are new and innovative opportunities in online advertising that have driven OXO to pursue those options. Finally, OXO has not spent the money necessary to test advertising effectiveness in the past. Online promotional efforts are cheaper to assess.

2. Describe OXO’s overall advertising strategy? As described initially, OXO doesn’t advertise. Historically, OXO has done very little direct-to-consumer advertising. As Bena Shah points out, the company has relied more on PR and word-of-mouth. Its previous strategy was rather fragmented. OXO seemed to try things in a less strategic approach and then only continue them if something worked.

Now, OXO is more focused on online and social media. It is putting efforts in to the major social networks, blogs, and online ads.

3. Is OXO abandoning its old promotional methods? How is OXO blending a new advertising strategy with the promotional techniques that have made it a success? Because OXO spent very little before, it is not apparent that the company is abandoning its old ways. The company makes it clear that they have always focused heavily on generating word-of-mouth. They see social media as an extension of that strategy. So they are not abandoning efforts to create buzz about OXO products. They are simply employing new methods.


Teaching Ideas

The video case for OXO follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. In this segment, we are introduced to the fact that OXO has never really engaged in mass-media advertising for various reasons.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. While OXO is a major national brand, it competes in small product categories. As a result, the return on investment for the expense of mass-media advertising is not there. OXO has to accomplish its promotional objectives in other ways.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. Clearly, OXO is doing the best that it can with its available resources. Students should be challenged to consider whether or not OXO’s promotional strategy is sound and whether or not it will provide for the best future for the brand.

Video Case Chapter 15E*trade

Location: Menlo Park, California

Running Time: 5:07

Video Summary

Super Bowl XXXIV, the first of the new millennium, was known as the Dot-com Bowl for the glut of Internet companies that plopped down an average of $2.2 million per 30-second spot ad. One darling of the dot-com era, E*trade, remains one of the few survivors of the Dot-com bust. One of the principal factors in its ability to hold on is a


successful advertising effort that has included Super Bowl advertising as a primary component.


1. What has been the role of advertising at E*trade? Even before talking about the Super Bowl ads, Nicholas Utton discusses the role of advertising in general at E*trade. He specifically points to a concept from chapter 14, the AIDA model (awareness, interest, desire, action). Recognizing this as one of the core principals of developing ad messages is an important thing for students to notice. In talking about this, Mr. Utton points to how advertising is the “uninvited guest” as far as consumers are concerned. But on the other hand, advertising can be the facilitator for engaging consumers with the brand. That is how E*trade treats advertising.

2. What factors have played a role in E*trade’s decision to advertise on the Super Bowl. The first Super Bowl, Super Bowl 2000, E*trade recognized that it is the one event in which viewers are fully engaged in not only the program, but the advertising. This is an unparalleled characteristic of the program. E*Trade also recognized the value of one of the biggest audiences in television events.

A very important thing for students to recognize is, as pointed out by Mr. Utton, the Super Bowl is extremely expensive and it must be approached both cautiously as well as with ROI in mind. The message has to be compelling, engaging, and memorable. It has to break through the clutter and engage viewers in a theatrical experience.

3. Analyze E*trade’s most recent Super Bowl ads. Is E*trade still getting is money’s worth from Super Bowl Advertising? Explain.

Teaching IdeasThis is a good opportunity to show other Super Bowl ads from over the years. There are many sources for getting ratings and grades given to Super Bowl ads each year (Garfield’s “Ad Review” on Advertising Age is a good one). It may be interesting to choose some winners and some losers for various years, show them, and ask how they stand up from a Super Bowl ROI perspective, as discussed in this video case.

Video Case Chapter 16 – Medtronic

Running timeIntro: 1:05Problem: 1:57Solution: 3:15


Total: 6:17

Video Summary

Many companies sell products that most customers can literally live without. But the devices that Medtronic sells are a matter of life-and-death. Patient well-being depends upon the insulin delivery devices, implantable defibrillators, and cardiac pacemakers designed and manufactured by Medtronic. In some markets, seven out of eight medical devices in use are Medtronic devices.

But what happens when you know you have a product that will help a given customer in terms of cost, time, and end-user well-being, but you can’t get a foot in the door to communicate that information? This video demonstrates how Medtronic sales representatives maintain a customer-centered approach to the personal selling process as a means for effectively communicating their product benefits.


1. How is the sales force at Medtronic structured? From the information presented in this video, we do not know about Medtronic’s sales force structure. But from outside information (see http://online.wsj.com/article/SB10001424052748704013604576248793490210536.html), we know that Medtronic’s sales reps and teams are organized by product group – in this case, cardiac and vascular products. This, there is evidence for some aspect of a product sales force structure. However, it is likely that Medtronic’s sales force structure is more complex than this.

2. Identify the selling process for Medtronic. Give an example of each step. While it is not apparent from the video how Medtronic addresses each step in the personal selling process, consider the following:Prospecting and qualifying – at the very least, we know that Dominique did research on the hospital. Enough to know that the contract that Medtronic’s competitor had with the hospital was up for renewal. Dominique verified that this client was worth the effort and expense. Preapproach – Dominique clearly continued doing research on this client in order to establish all the potential barriers. Approach – Dominique establishes that the physicians at the hospital were open to listening to what Medtronic had to offer. Presentation and demonstration – The things that we learn from this video are that Dominique put a great deal of time and effort in to this aspect of the selling process. He focused on Medtronic’s advantages – a superior product, total cost savings, and mostly, on the service provided by Medtronic. It can be said that the presentation is carried out over time. Dominique gained access to patients and to being present during a procedure. Handling objections – we don’t have a lot of specifics here. But we know that Dominique exhibited patience and focused on the service aspect of the company, on his own dependability, and on building the relationship.


http://online.wsj.com/article/SB10001424052748704013604576248793490210536.html

http://online.wsj.com/article/SB10001424052748704013604576248793490210536.html

Closing – for Dominique in this case, this was the “easy” part. In fact, because of the nature of the situation, Dominique knew that all he could do was continue to pursue this client and make himself available. Rather than pressuring the client to sign a contract, he waited until they were ready. Once they were ready, they let him know. Follow-up – It is also very clear that Medtronic’s product is not one where the relationship with the sales rep ends after the sale. Part of the product is its service. Dominique clearly understands that. His presence and service are continually available as part of the overall marketing offering. As the video points out, Dominique doesn’t just follow-up with hospital administration and physicians. He follows up with patients.

3. Is Medtronic effective at building long-term customer relationships through its sales force? How? If not, what could be improved? Without a doubt, Dominique and Medtronic get this. The fact that he spent as much time with the client as he did before the client even agreed to a sale is evidence of this. The sales effort took almost a year. But everything that Dominique did during this time was focused on long-term relationship building

Teaching Ideas

The video case for Medtronic follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. This introduction segment touches on the concepts of recruitment and training of sales people as well as the nature of the product that Medtronic sells.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. In this segment, the barriers that sales representatives face are clearly outlined and explained. These barriers especially hold true for expensive and complex business-to-business products.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This is a great segment to illustrate the importance of building


relationships of trust with clients and potential clients. The video demonstrates how Medtronic does this through the personal selling process.

Video Case Chapter 17 – Home Shopping Network


Video Summary

Long ago, television shopping was associated with low-quality commercials broadcast in the wee hours of the morning selling obscure merchandise. But Home Shopping Network (HSN) has played an instrumental roll in making television shopping a legitimate outlet. Around the clock top-quality programming featuring name-brand merchandise is now the norm.

But just like any retailer, HSN has had it share of challenges. This video illustrates how HSN has focused on principles of direct marketing in order to overcome challenges and form strong customer relationships. As market conditions continue to shift, HSN explores new ways to form and strengthen direct relationships with customers.


1. Explain the different ways that HSN engages in direct marketing.As defined by the text, direct marketing involves connecting directly with consumers in a way that cultivates both a response and a relationship. As far as the different forms of direct marketing, HSN is involved in direct-response television marketing, online marketing, mobile device marketing, and forms of telemarketing.

2. What advantages does HSN specifically over brick-and-mortar retailers? It is getting more and more difficult to identify retailers that are only brick-and-mortar. Most chains are involved in multiple channels. To some extent, that includes online retailing. But HSN has advantages over regular brick-and-mortar and more traditional e-commerce retailers in that it is not just a retail outlet. It is a form of entertainment. So, as consumers shop, they are watching a television program. People become involved with and attached to the shows and hosts, just as they would with other television programs. HSN is also reaching consumers through more channels than most retailers (television, online, mobile, etc.).

3. Make recommendations for how HSN could make better use of its role as a direct marketer. Responses to this question will vary. But students should consider just how well


they believe HSN is doing in applying its self-proclaimed solution of expanding its content to all digital channels. HSN has a strategy for Internet and for mobile. However it is not entirely clear to what extent HSN is making its programming available through those channels. It is very clear that the way people are watching television is changing. And at some point, television as we know it today may not exist. It isn’t clear that HSN is fully preparing itself for the possibility that “watching television” may be gone at some point. Many of the tactics that HSN is developing for online and mobile still require the consumer to be sitting in front of a television to be exposed to HSN programs. HSN should be pioneering new ways for viewers to access programs

Teaching Ideas

The video case for HSN follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. In this segment, it is apparent that there is far more to HSN than most people realize.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. In this segment, HSN confronts a real problem faced by any and every television network. The way people watch television programs is changing. It will undoubtedly be very different in another decade. It is possible that at some point, television as we know it will not exist.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. HSN must adapt to the new and changing environment. In this segment, HSN explains how they are doing that. Students should be challenged to evaluate whether or not they believe HSN’s efforts go far enough.

Video Case Chapter 18Umpqua Bank

Location: Roseburg, Oregon


Running Time: 4:36

Video Summary

The retail banking industry has become very competitive. And with a few powerhouses that dominate the market, how is a small bank to thrive? By differentiating itself through a competitive advantage that the big guys can’t touch.

That’s exactly what Umpqua has done. One step inside a branch of this Oregon-based community bank and it is immediately apparent that this is not your typical Christmas club savings account/free toaster bank. Umpqua has created a business model that has transformed banking from retail drudgery to a holistic experience. Umpqua has created an environment where people just love to hang out. It not only has its own music download service featuring local artists, it even has its own blend of coffee.

But under all these bells and whistles lies the core of what makes Umpqua so different: a rigorous service culture where every branch and each employee gets measured on how well they serve customers. That’s why every customer feels like they get the help and attention they need from employees.


1. With what companies does Umpqua compete?The video does not directly address this information. However, because of the banking services offered by Umpqua, it remains that its primary competitors are other banking organizations. One might recognize that the primary competition may come from regional banks and credit unions. People who are more likely to prefer a non-global, large corporation would be more open to choosing Umpqua. But there is also a strong case for such banks as competitors, given that Umpqua’s competitive advantage offers a drastic alternative to the “business-as-usual” approach of such banks.

2. What is Umpqua’s competitive advantage?Banking has been fundamentally the same for 500 years. Umpqua has differentiated itself as a service organization, not a banking organization. It has taken best practices from industries like restaurants and hospitality and applied them in the banking environment. Not only is this rooted in how each employee treats and serves customers, but it is based on the experience the customer has when it engages in Umpqua’s customer interface. This includes all the aspects that make Umpqua’s retail outlets feel like a place that customers want to hang out as well as those “non-banking” features on Umpqua’s Website.

3. Do you think that Umpqua will be able to maintain this advantage in the long run? Why or why not? Based on the information in the case, Umpqua should be able to maintain its competitive advantage. A couple of things that are typically considered when assessing the longevity of a competitive advantage are:


Can the competitive advantage be copied? While it might seem likely that someone else would copy this, the root of Umpqua’s success with its holistic strategy is in the corporate culture. No company could pull something like this off without a culture that is completely entrenched in the concept. Thus, this makes it less likely to be copied. Can the company continue the competitive advantage without running in to cost issues? According the video, Umpqua’s strategy doesn’t cost any more than any other strategy. It’s simply a matter of choice, design, and execution. Will the customer environment change such that customers are no longer drawn to the competitive advantage? This is always an uncertainty. However, it is probably safe to say that banking customers would rather step in to an environment like that at Umpqua than that at traditional banks and that there is no foreseeable reason that this would change.

Teaching Ideas Have students brainstorm a list of service industries where there is a norm for the type of offering presented across organizations. Then, have them consider whether or not there is a company that has done what Umqua has done; that is, bucked the system by developing a service model that breaks the boundaries of the industry. If one does not exist, have them suggest some type of alternative that a company might pursue.

Video Case Chapter 19 – The U.S. Film Industry


Video Summary

If you like movies, you’ve no doubt seen a foreign film at some point. But did you know that American films are some of the biggest and most anticipated foreign films in the world? In fact, foreign box office and DVD sales account for nearly 70 percent of all revenues for the U.S. film industry. With that much financial impact, foreign markets are playing a bigger and bigger role not only in the pricing, distribution, and promotion of U.S. films, but in the product itself.

This video illustrates the challenges faced by the U.S. film industry stemming from differences in the marketing environment throughout different international markets. The result is that this industry is now like any other export industry. The marketing mix must be adapted at an optimum level in order to meet the needs of global markets while still maintaining the benefits of standardization.



1. Which part of the marketing environment seems to be having the greatest impact on U.S. films abroad? It would seem that the cultural environment has the greatest impact. Finding a formula for a film that appeals to the tastes of film-goers everywhere is tremendously difficult, given the major differences in cultural characteristics. The political-legal environment can also make or break a film (in some cases, U.S. films are extremely limited or even prohibited). But that barrier aside, the cultural issues are always present.

2. Which of the five strategies for adapting products and promotion for the global market is most relevant to the U.S. film industry? From what Gray Frederickson shares in this video, major filmmakers today adapt both the product and the communication strategy. Thus, dual adaptation is the strategy that is most relevant.

3. Is the U.S. film industry now dependent upon foreign markets for success? Compare the export of U.S. films to other U.S. exports. As Gray Frederickson points out, the cost of producing films today is very high in most cases. This is because of the increases in salaries and fees paid to actors, the cost of modern technologies, and the increases in promotional expenses. In the old days, the industry did not need foreign box office revenue to be profitable. That was merely icing on the cake. However, today, it is clear that the industry as a whole is dependent upon foreign markets. In numerous cases, U.S. box office revenue alone is not sufficient to break even.

Teaching Ideas

The video case for the U.S. film industry follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. This introduction introduces us to the idea that global marketing of Hollywood movies is a relatively recent practice.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then


has the option of whether or not to show the solution segment. This segment makes clear various challenges that all global marketers face.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This segment also translates to virtually all companies in all industries. Companies are concerned about the cost benefits of standardization, but also seek the ability to cater to the needs of different customers in different countries. The best approach to balancing these two approaches is to design the product for a global market from the beginning.

Video Case Chapter 20 – Life Is Good


Video Summary

Most companies these days are trying to figure out how they can be more socially responsible in manufacturing and marketing of goods and services they produce. But few companies produce goods and services with the primary purpose of making the world a better place. Life Is Good is one of those companies. Most people are familiar with the cheerful logo on Life Is Good products. But few are aware of what the company does with its profits behind the scenes.

This video focuses on Life Is Good Playmakers, a non-profit organization dedicated to helping children overcome life-threatening challenges. From the time Life Is Good started selling t-shirts in the early 1990s, its founders supported Playmakers. The relationship between the two organizations progressively became stronger, ultimately leading Life Is Good to make Playmakers an official branch of the company.


1. Give as many examples as you can for how Life Is Good defies the common social criticisms of marketing.High advertising and promotional costs – LIG doesn’t advertise!Shoddy, harmful, and unsafe products – just good quality apparel. Too few social goods – the entire mission of LIG is built around the Playmakers foundation. Selling apparel is simply the means to that end.

2. Discuss how Life Is Good practices sustainable marketing principles. This video focuses on the socially responsible practices that are at the core of LIG. Bert Jacobs admits that this is not what has built the business. It is the


quality apparel with great graphics, communicating a message of optimism. Now, as LIG attempts to educate the world about the things that are at the core of the LIG mission, Bert believes that this will have the effect of causing “all oars to rise.” In other words, educating people on what LIG is about will only serve to make people more socially aware. That in turn will lead them to seek products from socially responsible companies.

3. With all its efforts to do good, can Life Is Good continue to do well? Explain. LIG’s main goal is to “sell” people on the true purpose of the company – to support the causes championed by the Playmakers foundation. Only one in 50 of LIGs customers know what the company is all about. So, it is LIG’s goal to inform the other 49. If the company is already doing well, it would seem that informing customers if its very deep roots in social responsibility will only serve to create a great customer-brand bond and to ultimately sell more merchandise.

Teaching Ideas

The video case for Life Is Good follows a unique format for videos in the Pearson Video Library that accompany Armstrong and Kotler’s Marketing: An Introduction, 11e. It begins with an introductory segment, followed by a problem segment, and ends with a solution segment. The intention here is to provide flexibility and multiple options for using the video. The following are some of the ways that instructors may utilize these three video segments.

1. Introduction only - Instructors may choose to use the introduction segment alone as a means of highlighting the company. As a stand-alone video, the introduction segment supplements material in many of the chapters of the text. The introduction of this Life Is Good video clearly illustrates not only the origins of the company, but how the brand image revolves around the concept of optimism.

2. Problem challenge - The instructor may show the problem segment, either with or without the introduction segment, and with or without the solution segment. This may be done in the interest of time. It may also be done strategically. An ideal way to challenge students is to require them to develop possible solutions to the presented problem before they have seen the solution segment. The instructor then has the option of whether or not to show the solution segment. It isn’t easy for a company that is founded on principles of social responsibility to make money. However, it is very clear from listening to Bert Jacobs that this company is already doing well. Thus, spreading the word on its mission should only serve to help the company even more.

3. Solution only – This may be done to illustrate a specific concept in the chapter. Rather than taking the time to perform a problem/solution exercise, the solution segment may be shown to demonstrate how a company overcame a specific problem. This final segment illustrates how LIG is focusing on educating their customers on the company’s true mission.


Documents

Video Case Teaching Notes