MKTG 433, Marketing ManagementSummer I, 2014
Midterm Exam, Part II. Short Essay Questions. (50 points)
Students must compose a response to each of the following proposed questions. Be sure to respond in essay fashion (paragraphs and a total of not less than 250 words each) using the introduction, body and conclusion format. Write complete sentences and be mindful of paragraph formation. Eliminate personal pronouns – Write in third person APA style. Use terminology, concepts and vocabulary extensively. Save your work as a WORD doc and submit as an email attachment.
Question #1.
Cabbage Patch Kids Get 2014 Makeover with Skechers Shoes
Bloomberg BusinessWeek, Matt Townsend May 27, 2014
Cabbage Patch Kids are getting a 2014 makeover, with help from Skechers (SKX) USA Inc.
The dolls, which were so popular in the 1980s they drove moms to fisticuffs, are hitting stores later this year with new outfits and Twinkle Toes, a line of Skechers sneakers that sparkle and light up. Jakks Pacific Inc. (JAKK), the toymaker with the rights to the Cabbage Patch franchise, is trying to reinvigorate the brand and find new ways to reach consumers. The Malibu, California-based company is in talks to sell the $34.99 dolls in Skechers’s locations, helping make up for a shrinking number of toyshops and toy departments in the U.S.
“They’re bringing Cabbage Patch into today’s era,” Stephen Berman, Jakks’s chief executive officer, said in an interview. “They are really cute looking, dressed cute and wearing the most fashionable kids shoe.”
The licensing deal with Skechers is part of a broader strategy to expand distribution, brought on by the changing economics of the toy industry. Retail chains like Target Corp. (TGT) are shifting square footage to groceries, leaving less room for dolls and action figures. The demise of specialty chains such as KB Toys Inc. also has forced toymakers to get more creative, Berman said.
Source: JAKKS Pacific
This fall Cabbage Patch dolls will be wearing Twinkle Toes, popular girls’ sneakers from Skechers USA Inc. that are very sparkly and can light up too.
What is strategy? What are the forms of strategy? Using Ansoff’s theory, which form of strategy, has Jakks Pacific Inc. planned? Will the strategy prove effective?
Question #2.
Go to: http://www.surfair.com/Study the website.
What is CRM? How does an effective CRM program build loyalty? Which type of program has surfair.com utilized? Do loyalty programs foster customer satisfaction?
Question #3.
Go to: http://www.surfair.com/Study the website.
Suggest and outline a market research plan Surfair might conduct to measure consumer satisfaction.
Question #4.
Daimler’s Smart Car Nears Relaunch of Four-Door ForFour
Bloomberg BusinessWeek, Dorothee Tschampa, June 05, 2014
In 1998, Daimler made a brash gamble based on a simple idea: that people in cramped cities wanted a cheap car so small that parking would never be a problem. The two-passenger, two-door Smart car hit the market with a $9,150 price tag, measuring 98 inches long, 60 inches wide, and 61 inches high.Sixteen years later and after more than $4 billion in losses, according to estimates by Bankhaus Metzler, the German automaker figures the diminutive car has a problem—it’s too small. In July, Daimler will introduce an upgrade of its ForTwo model and roll out the four-door ForFour to try to reignite interest in Smart cars.
The ForFour is bigger, but not too big, because Daimler plans to challenge other so-called city cars, such as the Fiat 500, the VolkswagenUp! and General Motors’ Opel Adam. The ForFour will be about 11.5 feet long, 30 inches longer than the original ForTwo, but about 2 inches shorter than the 500 and the Up! the bestselling city car in Germany. Its engine will be in the rear, shortening the hood and offering more legroom.
The fewer inches and extra space could be a crucial advantage for Smart. As urban populations grow, global sales of small city cars are expected to increase 35 percent by 2020, to 6.2 million vehicles, according to research company IHS. Such vehicles have been most popular in Europe, where parking is harder to come by than in many U.S. cities. “When I drive into the city, I don’t need to worry about searching for a parking space,” says Ralf Waitschies, a travel agent near Hamburg who’s driven Smarts since 2000. “There’s always a spot available.”
The new car is Daimler’s second attempt at a four-door city car. A previous version of the ForFour, modeled on Mitsubishi Motors’ Colt hatchback in a joint venture, was rolled out in 2004. It looked nothing like the ForTwo and was pulled off the market in 2006—the same year Daimler canceled plans to build a Smart sport-utility vehicle. This time, Daimler is teaming with Renault to design and build the new Smarts—which do resemble the smaller car. As much as 75 percent of the parts in the revamped two-seater and the four-seater, as well as in Renault’s compact Twingo, will be identical, cutting production costs. (The ForFour and the Twingo will be built at Renault’s factory in Novo Mesto, Slovenia.)
Broadening Smart’s appeal will help Daimler’s Mercedes-Benz brand, which lacks a mass-market car. Increasing sales of Smart would also help Daimler sell more high-margin models such as the Mercedes S-Class while still meeting tight environmental regulations. Smarts help lower Daimler’s average fleet emissions.
The stakes are high for Daimler, says Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch Gladbach, Germany, and a former Smart marketing manager. Smart never lived up to an original goal of delivering up to 200,000 autos a year, and global sales, which peaked at 139,000 in 2008, were 98,200 last year.
IHS predicts Smart deliveries will almost double, to 182,900, next year. “It will be quite a long way before they turn a profit,” says Jürgen Pieper, a Frankfurt-based analyst with Bankhaus Metzler. “But expansion is the only way.” Says Bratzel, “They’ve only got one shot at this and have to get it right this time.”
Identify, define and discuss three specific macro-environmental factors that influenced Daimler’s strategic decision to redesign and introduce the ForFour.
Question #5.
Sarah Jessica Parker Gets Back to Serious Business—Shoes
Bloomberg BusinessWeek, Amanda Fitzsimons, April 10, 2014
Sarah Jessica Parker, the woman who introduced Manolo Blahnik and Christian Louboutin to the mall-shopping masses, would rather not buy new shoes. “They’ve gotten a little more involved in the past 10 years,” she says from her home office in New York. “They have a lot more stuff stuck on them now.” The irony of this statement isn’t lost on the 49-year-old actress, who, as Sex and the City’s Carrie Bradshaw, popularized the idea that every wardrobe needs expensive pumps. As Carrie once famously said: “Men I may not know, but shoes? Shoes I know.”
Even so, as premium shoe prices crept up—styles at upscale department stores average $750—and simple designs got harder to find, Parker saw an opportunity to use her brand for good—and profit. “Shoes seemed like the most natural connection because of the role I played on a show for so long,” Parker says. “And I thought, ‘How could I ask someone else to spend their hard-earned dollars on something that I myself might not wear every day?’ I wanted a beautiful, well-made shoe that was still affordable, that would last forever in your closet.”
“There’s a certain type of woman who can’t afford designer but doesn’t want cheap heels”. In February she introduced SJP, a line of women’s shoes, plus three handbag styles and a trench coat. The collection is full of pretty pastel suede pumps, summery T-strap sandals, and other options with ladylike names that reference the classic style of Maud Frizon, a 1940s fashion designer, and Etta James. No heel in the 25-piece collection is higher than 4½ inches, and many are half that. But the most sensible thing is their cost: Pairs range from $195 to $485, placing them above Aldo or Nine West but below all the designers
who became household names thanks to Sex and the City.
Which type of segmentation variables (descriptive or behavioral) explains the decision to purchase a pair of SJP shoes? Identify and explain the specific segmentation strategy implemented. Discuss fully.
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