Monthly Archives: November 2017

“Stranger Things” Hoodie and the Science Museum of Minnesota

What do you think is the most popular wearable on the market right now? If you guessed some sort of high tech fitness tracking, you would be…. wrong! The most popular wearable lately is the decidedly low-tech sweatshirt worn by Dustin, one of the nerdy middle-school students on the Netflix blockbuster series, “Stranger Things.”

With an average viewership of more than 8.8 million people per episode for season two, Dustin wore a vintage Science Museum of Minnesota hoodie (featuring a drawing of a brontosaurus skeleton). It sent the Internet rocking and social media went crazy. The Science Museum was deluged with requests from fans to buy the hoodie. The only problem was that it no longer existed. The vintage art work used on the shirt was from the 1980s and found online by the show’s costume designer.

The Museum quickly commissioned new apparel to match the show and started selling it online and in the Museum’s store on Nov. 7th. What happened next was amazing. The website traffic was so heavy that it crashed the server! And, when it was operating, fans faced a checkout wait time of 20 minutes. In addition, hundreds of fans waited in line on a cold Minnesota November day. By the end of the day, the shirts had all sold out, totaling $400,000 in sales for the Museum in support of its mission to “inspire learning, inform policy and improve lives.” (Don’t worry – more are being reordered.)

Product placement works (even it’s for an old product)!

Group Activities and Discussion Questions:

  1. Discuss product placement and its role in promotion.
  2. Poll students: Who has watched, or heard of, “Stranger Things”?
  3. Consider showing a trailer for students who are not familiar with the series: https://youtu.be/vgS2L7WPIO4
  4. Show the Science Museum of Minnesota’s Web site: https://www.smm.org/strangerthings
  5. Poll students: What product placements can they recall seeing in the past month in TV shows or movies?
  6. What makes an effective product placement?
  7. Divide students into teams. Have each team select a popular show that they have watched. What products or services would be a good fit? Why?

Source:  Harlow, T. (2017, Nov. 7). Sales of ‘Stranger Things’ hoodie overwhelms Science Museum of Minnesota website. Minneapolis Star Tribune.

 

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World’s Largest Online Retail Shopping Event: 11/11 Singles Day

Once again the world’s biggest shopping event has occurred. And, no, it’s not Black Friday and Cyber Monday in the U.S. By far, the biggest shopping day of the year was on November 11, Singles’ Day, in China. (The holiday originally began in 1993 as a celebration for people who are single, chosen because of the connection between singles and the number ‘1’. November 11 now serves as an occasion for single people to party – and shop!)

This year, sales reached more than $8.6 billion in the first hour and passed 2016’s total sales by noon! By the end of the day the gross merchandise value tally was more than $25.3 billion, an increase of 39% from 2016 sales! Even more impressive though is that a whopping 90% of sales were completed from mobile devices (compared to 82% in 2016). At its peak, Alipay processed 256,000 transactions per second.

Singles’ Day is by far the largest shopping and entertainment festival in the world. Consider that it is 18 times bigger than Amazon Prime Day, and 2.5 times bigger than Black Friday and Cyber Monday combined. This year there were more than 15 million products from 140,000 top brands and companies. Top countries selling to China included Japan, U.S., Australia, Germany, and South Korea.

Singles’ Day has become an event on its own, including celebrities, fashion shows, TV galas, virtual reality, and augmented reality shopping. Companies engaged in a “Catch the Cat” augmented-reality game that engaged customers and offered discounts. There were other games as well, including an interactive trivia game on Tmall and Taobao apps. In addition, Alibaba offered viewers a televised gala that featured international stars including Pharrell Williams, Nicole Kidman, Jessie J, Maria Sharapova, LeBron James, and Zhang Ziyi.

Why is it so important for global brands to enter this shopping day? Consider that there are roughly 300 million middle-class shoppers in China, rising to an estimated 500 million in the next 10-15 years. While Singles Day may have originally started for lonely Chinese consumers, the shopping day now is seen as critical to driving China’s – and the world – economy.

If you are not familiar with Singles Day, there are a number of Web sources with information about the event and Alibaba, including the following:

Group Activities and Discussion Questions:

  1. Most students will not have previously heard of China’s Single Day. Discuss the shopping holiday and its importance in China.
  2. This is likely the first time students have heard about Singles Day. There are a number of videos that can help explain the event:
    1. What is 11/11?  https://youtu.be/bRv9qG75x2c
    2. Singles Day: https://youtu.be/uDDy50RP67A
    3. An American at Alibaba: https://youtu.be/7ZxM_HaEWBI
    4. News reports: https://youtu.be/gwGGrLpUkdg
    5. What is Alibaba: https://youtu.be/gk69hV6LEgI
  1. Discuss how this holiday compares to Black Friday and Cyber Monday in the U.S.
  2. How should U.S.-based companies participate in Singles Day?

Source: Brandchannel.com (2017, Nov. 13). Alibaba’s 2017 11.11 global shopping festival passes $25B.

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iPhone X – Premium Pricing

Apple introduced not just one, but two new models of the iPhone this fall: iPhone 8 and iPhone X (ten). Sure, companies often introduce multiple new products at the same time, but rarely do they introduce products that are so similar in scope and use. Why did Apple introduce two models at the same time? Easy – two different models are for two different market segments.

At a price of $999 (64 GB) and $1,149 (256 GB), the iPhone X is Apple’s first premium level iPhone model. And, since it has leading-edge features unavailable on any other smartphone, it seems to be targeting the early adopters and tech enthusiasts who are not price sensitive.

What does the iPhone X have?

  • 8 inch screen takes up the entire face of the device
  • OLED display for thinner, brighter, viewing
  • Face ID infrared facial scanning

The strategy seems to be working. After only a few days of pre-ordering iPhone X online, delivery times are easily two months away.

Are you planning on buying one?

Group Activities and Discussion Questions:

  1. Pricing is usually a complex topic. Discuss the six steps for pricing (determining objectives, estimating demand, determining cost/profit relationships, select price level, set list price, and make adjustments).
  2. Discuss the various pricing models in class: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
  3. Show iPhone X: https://www.apple.com/iphone-x/
  4. Show CBS Video: https://youtu.be/haj5nV6Muhw
  5. For iPhone X product, divide students into groups and have each group work on any/all of the six steps.
  6. When setting the price level, assign each team a different model to use (demand-oriented, cost- oriented, etc.).
  7. Debrief the exercise. Compare the various pricing models and discuss advantages/disadvantages of each.

Source:  New York Times, CBS, other news sources

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