Tag Archives: competition

Google Acquires Fitbit

Acquisitions can be tricky. Companies need to assess what markets to enter, and which products and services are needed for those markets. While it is common for food and beverage companies to use acquisitions to gain market share, it can be a tad trickier when combining technology companies. A key consideration is that companies find synergies that can be capitalized on when combining organizations.

A recent acquisition of interest is the purchase of fitness tracker pioneer Fitbit by search engine giant Google for an estimated $2.1 billion. The acquisition moves Google into a better position in the wearable technology market and gives Fitbit access to more resources, technology, and marketing. (However, there are still some outstanding issues with government regulators; use by Google of Fitbit data for advertising purposes is a concerns to regulators.)

Fitbit is a familiar company to most college students. Founded in 2007, the company makes watches and bracelets to track health information; it has an estimated 20 million active users. New Fitbit products include Fitbit Stress, featuring stress management tools and an ECG app to assess heart rhythm. Fitbit’s products are carried in 39,000 retail stores in 100 countries. Annual revenue in 2009 was $1.4 billion.

Fitbit’s overall market share has decreased dramatically since the introduction of Apple Smartwatch. Its market share of 4.7% is significantly lower than the market leader Apple at 31.7%, followed by Xiaomi and Huawei.

How do you track your fitness?

Group Activities and Discussion Questions:

  1. Discuss the four key marketing strategies: product development, market development, market penetration, and diversification.
  2. Discuss diversifications/acquisitions as a marketing strategy. When is this effective? When is it not effective?
  3. Show Fitbit’s Web site and products: https://www.fitbit.com/global/us/home
  4. Show Google’s products’ Web site: https://about.google/intl/en_us/products/
  5. Do these two companies complement each other? If so, now?
  6. Divide students into teams. Have each team develop a promotional plan that the companies can use to promote their combined value to customers.

Source: Associated Press; CNN News; Wall Street Journal; other sources

 

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LG’s New Rollable TV costs $87,000

It’s finally here and it is incredible! Last year at the Consumer Electronics Show in Las Vegas, LG Electronics showcased an innovative, rollable screen TV. Now, the TV is in production and will be available next year in South Korea for the price of…. (Insert drum roll)… $87,000!

Did that price surprise you? Yeah, we thought so.

The screen is 65-inches and is built around a flexible OLED panel that uses self-lighting pixel technology and dimming control to delivery an amazing picture. Since the screen is flexible, it can retract partially or fully into its base, adapting to different aspect ratios. When fully retracted, no screen shows.

The base does come in four different colors, plus the aluminum base can be inscribed with words of wisdom (such as “you paid what for this?!”). The base also includes a sound bar for premium listening.

Regardless of price, the rollable TV is truly revolutionary. Instead of owners setting up a large black screen that always is in place, even when off, LG’s unit liberates the TV from the wall.

Ready for a new TV?

Group Activities and Discussion Questions:

  1. Pricing is 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 a video of LG’s rollable $87,000 TV: https://www.impomag.com/home/video/21199409/lg-reveals-jawdropping-price-on-rollable-tv?lt.lid=5f90574cfed1277042925d3d&lt.ack=ryRUDA6PD&lt.usr=71617211&utm_source=IMPO_10212020&utm_medium=email&utm_campaign=124311&utm_term=643230
  4. For specifications, view the news release from LG: http://www.lgnewsroom.com/2020/10/commercial-launch-of-lgs-long-awaited-rollable-oled-tv-marks-turning-point-in-tv-history/
  5. For LG’s rollable TV, 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: CNET, Engadget, IMPO Insider, The Verge, other news sources

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Chobani Expands Product Line to Include New Snacks

Chobani made a name for itself years ago when it helped to launch the Greek yogurt trend in the U.S. The company is also creative when it comes to adding new products such as non-dairy and probiotic products, and products for kids. And Chobani is not resting on its laurels – the company just announced a new line of on-the-go snacks called Chobani Complete. The products are directed to shoppers who are looking for a midday snack that is healthy (and not full of sugar!).

Chobani is far from the only company looking to cash in on snacks with protein. Kind has new energy bars made with whole grains containing protein, and other snack companies such as Vita Coco are embracing the trend.

Chobani promotes its snacks as lactose-free, easy-to-digest yogurt and shakes with zero added sugar, 3 grams of fiber, 20 amino acids, and 25 grams of protein. It is available in cups, shakes, and tubs.

Chobani also takes social responsibility seriously. It has a food incubator program that helps food startups with grants and support, a mentorship program, and charitable programs promoting healthy eating for children and parents.

Ready to snack?

Group Activities and Discussion Questions:

  1. Discuss how to build and use a SWOT analysis grid: strengths, weaknesses, opportunities, and threats (internal and external factors).
  2. Show video: https://youtu.be/xDi3oVh1rEc
  3. Show Chobani’s Web site with the new products: https://www.chobani.com/products/complete/
  4. For Chobani, break students into teams and have each team build a SWOT analysis grid.
    1. Strengths: what is company good at?
    2. Weaknesses: what needs work?
    3. Opportunities: what is going on in marketplace?
    4. Threats: what should company be wary of?
  5. Based on the analysis, what are the issues and risks that might occur?

Sources: AdWeek

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