The entertainment streaming industry is on fire right now. Apple, Hulu, Netflix, Disney, HBO, and more brands are ramping up to fight it out for the monthly consumer subscription!
Here is how the current prices compare between services:
||$11.99 (ad free), or
$5.99 (with ads)
|Amazon Prime Video
||Marvelous Mrs. Maisel
||The Morning Show
Notice anything interesting in the prices? How each price ends? Which vendor is using penetration pricing? Or below-competition pricing? Name a price model and it’s probably on the list above. Blockbusters, as well as all-new created movies and shows are all offered from multiple services and it can be hard to determine which has which. The marketing focus should be on differentiation – the services are starting to sound alike, and be priced alike.
There has been a dramatic shift in recent years about how consumers get their information and entertainment, and how many more consumers use streaming services each year. The average consumer in 2019 has 2.6 stacked services. This is up from 1.6 stacked services in 2016, but far short of the projected 4.9 staked streaming services by 2023.
Think about it… how many services are currently in your household?
Group Activities and Discussion Questions:
- Poll students: How many subscription services does each household have today? Add them and average it for the class.
- Show a video about the topic: https://www.wsj.com/video/video-streaming-services-battle-for-subscribers/AED37E41-E1EC-447A-A47F-C55D1834B7E0.html
- 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).
- Discuss the various pricing models in class: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
- For these streaming services, divide students into groups and have each group work on setting the price level.
- Assign each team a different model to use (demand-oriented, cost- oriented, profit-oriented, and competitor-oriented) and have the team explain how the model was used when setting their price.
- Compare the various pricing models and discuss advantages/disadvantages of each.
Source: FitzGerald, D., & Flint, J. (29 October 2019). AT&T lays out price, show line-up for HBO. Wall Street Journal; other news sources
What is a brand? Does a brand have a financial value? These are critical questions that drive the strategic marketing decisions of corporations around the world. In general, marketers define brand as the position that a company/product holds in the minds of the consumers. It follows then that if the brand holds a position in consumers’ minds, then it would definitely translate into a financial value for companies.
Each year, Interbrand does a financial analysis that seeks to define, in dollars, the value of a company’s brand – the result is the annual Best Global Brands ranking. In order to be included in the analysis the brand must be global – it must have successfully crossed geographic and cultural boundaries:
- At least 30% of revenue must come from outside the brand’s home country.
- It must have presence in at least three continents as well as broad geographic coverage in emerging markets.
- There must be sufficient publicly available data on the brand’s financial performance.
- Economic profit must be expected to be positive over the longer term, delivering a return above the brand’s operating and financing costs.
- The brand must have a public profile and awareness above and beyond its own marketplace.
Interbrand’s brand valuation methodology seeks to determine, in customer and financial terms, the contribution of the brand to the company’s business results. There are three key components in the methodology for the valuations: analyses of the financial performance of the branded products or services, of the role the brand plays in the purchase decision, and of the competitive strength of the brand.
The results – well, see for yourself by viewing the interactive report: https://www.interbrand.com/best-brands/best-global-brands/2019
At the top of the list are Apple, Google, and Amazon; each brand is valued at more than $100 billion! And in honor of the list’s 20th year, there are 31 brands from 2000 that are still in the Top 100 today.
Which brands made your list?
Group Activities and Discussion Questions:
- Ask students to define “brand.” What is it? Does it have value to a company?
- Have students take out a piece of paper (or write answer on laptops). Ask them to choose what they thing are the top 10 most valuable brands in the world. Then show the top 10 list from the Global Brand report.
- Bring up the Web site: https://www.interbrand.com/best-brands/best-global-brands/2019/
- Show the video explaining the report: https://www.interbrand.com/best-brands/best-global-brands/methodology/
- Show students several of the sections within the site and view some of the videos as a class.
- Divide students into teams and assign each team an industry category to examine: automotive, apparel, beverage, electronics, energy, etc.
- Have each team present key findings from the industry sector they examined.
- How can these findings be applied in marketing strategies?
Source: Brandchannel.com, Interbrand.com