Will customers subscribe to Nike shoes?

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The Nike Adventure Club is an interesting new sales approach from the leader in athletic footwear. The target market is parents, who would pay a monthly subscription fee (of $20, $30, or $50 per month) to get new shoes every 90, 60 or 30 days. You can read more about the new business model in this Fast Company article, “Nike’s first shoe subscription, two years in the making, is here.” Part of the pitch is sustainability–as customers return the old shoes for recycling by Nike. But as the article notes, this may not be the best approach to lowering carbon emissions.

Companies love the subscription model as it can help drive up customer lifetime value (Chapter 2). You can now subscribe to get regular boxes of healthier snacks (SnackSack), date nights (Date Night in a Box), or doggie gifts (Dog Mom Box). These might be some interesting examples to offer when you get to the first pricing chapter (Chapter 17).

From green ketchup to Colgate lasagna: Companies’ biggest product failures

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It is always fun to show students product failures. Especially like those shown here. I think intuition alone would tell most of us that these were not such good ideas. But it is good for students to see that even big companies, with lots of money and smart people, can make mistakes.

You might want to add a few of these images to your coverage of product (Chapter 8) or new product development (Chapter 9). Colgate Lasagna (really?) could be used with the growth opportunity matrix in Chapter 2 as an example of why diversification is so risky. Or the Bic Her (pens designed for women) might be an example of segmentation and targeting gone too far.

Millennials are boosting some industries…

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As we point out in Chapter 3, marketing context, including the broader cultural and social environment can bring about threats or opportunities. As Millennials (those born between 1978 and 1994) have more discretionary income, they are being blamed for killing a number of different industries including cereal, department stores, beer, golf, and more (see list here). So this generation is definitely a threat to those industries.

On the other hand, Millennials buying behavior has boosted other industries, see “Coffee, travel, and skincare are among 12 industries millennials are boosting,” Fast Company, September 9, 2019. These examples can be used when you discuss SWOT (Chapter 2), the cultural and social environment (Chapter 3) or segmentation (Chapter 4).

2018 Brand Failures

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We generally focus posts on clever, interesting, and/or effective marketing news but this post is all about marketing failures.  Marketing Dive recently posted an article titled “Relive the year’s 6 biggest brand fails — they carry important lessons for marketers” that covers failures from Facebook (via Cambridge Analytica), Papa John’s, McDonald’s, Heinekin, Snapchat, and the digital media ecosystem.

The causes of these failures are varied but the impact is significant.  For instance, following a redesign of the Snapchat app, influencer Kylie Jenner tweeted that she didn’t use the app anymore.  That tweet erased $1.3B of Snapchat’s market value overnight.  McDonald’s tried to show support for Women’s Day by flipping their golden arches upside down but it wound up being perceived as a publicity stunt and drew attention to some of McDonald’s own issues related to it’s female employees.  The article covers these issues and more as well as talking about some of the lessons to be learned from each case.

Survey Overload

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Tom Fishburn recently ran this Marketoonist comic which hits close to home, particularly during holiday season.  We teach students the importance of making market-based decisions and getting direct consumer feedback is an important part of that process.  However, companies now inundate consumers with surveys.  The volume of surveys increases which leads to surveys being ignored which only leads to reminder messages and more aggressive survey tactics.

Marketing week ran a recent article by Tom Goodwin talking about this issue.  In the article, he talks about this dynamic and suggests the issue is rooted in a desire to gather easy to measure KPIs rather than really digging in to understand customer needs.  Electronic addiction is making it easier for marketers to gather information on consumers but we don’t always know how to properly interpret that information.  Marketing data analytics is an emerging need for companies to learn what information is worth gathering, how to interpret that information, and how to use that knowledge to drive strategy.