This provides a nice B2B example when you talk about segmentation and targeting, media or advertising.  The business model also could be used as an example of an alternative pricing model for software.

This article would be good to read for examples relevant when you cover price setting — but could also be used to talk about consumer behavior and retailing.

This article could be assigned — or the highlights could be covered with a quick in-class overview — and then discussed in class.  You might ask students to discuss the value proposition Tide Pods offer.  Will consumers value convenience enough to pay the higher price? Who should Tide Pods target?  What could they do for promotion?  The image in this post is from the print advertising campaign — and the video below is a TV ad.

Now a company called eight19 has a new business model that is bringing lower cost solar power into the homes of many of Kenya’s poor.  They use a system where consumers pay a $10 deposit for a portable solar power unit, two LED bulbs, and an adapter to charge cell phones.  Consumers then buy scratch cards which allow them to use the unit – paying for energy as they go, but also paying off the unit over time.  After 18 months they own it, and they can continue to receive electricity for free or they could buy another unit and add more power.  See also “Starting from scratch” (The Economist, January 24, 2012).

The examples here might work well when you cover Place, retail, Price, or Promotion and want to provide an example of how a concept is adapted in international markets.

Sorry, I digressed.  Katie Boehret wrote a Wall Street Journal review of a new Android smartphone app, “Google Mobile App Aims to Turn Phones Into Wallets” (September 21, 2011, non-subscribers may need to click here).  It might be interesting to discuss the implications of this technology on consumer shopping behavior.  The article doesn’t really address that topic, but I think my students could come up with some interesting ideas — so I posted it with some questions over at Learn the 4 Ps.

This example is a bit complicated, but it demonstrates a number of important marketing concepts:

• Price and the freemium business model.  Freemium refers to a business model where most customers use a product for free, while a few power users cover costs.  More than 95% of Zynga’s 150 million monthly visitors pay nothing to play its games.  The other 5% pay hundreds and even thousands a year for virtual products that enhance their gaming experience.  For example, $5 might get you a chicken in FarmVille, a skyscraper in CityVille, or an anglerfish in FishVille.  Of course they love to sell these low cost virtual products…
• Fixed and variable costs.  There are minimal fixed costs for creating a new anglerfish, but the variable cost of producing hundreds of thousands of them is very small.  Almost no variable cost.Segmentation and targeting.  In this post at TechCruch (“Who Spends The Most Money In Freemium Games?” September 8, 2011), you can see by age group, who uses mobile freemium games — and who “spends”.  Not surprisingly, while more than half of users are under age 24 — this younger market contributes just 21% of the spending.  Consequently, most of the action in online games targets an older demographic.  And of course a little analytics can identify what products encourage spending…
• Marketing research.   In “Virtual Products, Real Profits,” (Wall Street Journal, September 9, 2011, non-subscribers click here), Zynga’s president of data-analytics says, “We’re an analytics company masquerading as a games company.”  Zynga analyzes game player behavior and adapts the game to get players to play longer or spend more.  For example, after finding that FishVille players bought the translucent anglerfish much more often than other sea creatures, they created more variations on the anglerfish.

I don’t play these games — but I have Facebook friends who love them.  Some of your students might relate to these examples.  Also posted at Learn the 4 Ps.

This might be fun stuff to talk about you cover consumer behavior, the external market environment (economic environment – kind of a counter-example), pricing or price sensitivity.

While fewer consumers perceive Wal-Mart as the low price leader, what is the reality?  The article reports mixed objective evidence.  In comparisons with Target, with one study by Morgan Stanley showing that in Chicago Target is about even with Wal-Mart (though Wal-Mart was more than 20% lower priced than Safeway and Supervalu) and another study by Goldman Sachs showing Wal-Mart 6.2% lower than Target overall.

This case study could provide interesting fodder when you discuss positioning.  We define positioning in our books as “how consumers think about proposed or present brands in a market.”  You can remind students that perception is what counts among consumers.

You might recall that a few years ago Wal-Mart changed its tagline from “Always Low Prices – Always” to “Save Money.  Live Better.”  Wal-Mart wanted to appeal to a more upscale crowd and develop a greener image.  Perhaps this change de-emphasized the previous price positioning.  The new dual positioning may not be as clear to consumers — opening opportunities for dollar stores to take the lowest price mantel from Wal-Mart.

This opens the door to a good discussion with your students.  Asking them:  What should Wal-Mart do now?  Change its positioning?  Or try to re-gain the low price position?  Given its history and strengths, it seems clear to me that the retailer needs to regain the consumer perception of value.  Perhaps there is a need for more advertising?  Or should the store revisit the everyday low pricing model it has traditionally used — perhaps the hi-lo pricing models of some competitors have helped confuse the market and harmed Wal-Mart’s positioning.  Also posted at Learn the 4 Ps.