Tag Archives: entertainment

McDonald’s Offers Adult Happy Meals – Complete with Toy

We’ve discussed the impact of nostalgia on marketing. (Nostalgia is when someone longs for a different time period when they were happy.) We usually think of nostalgia as being an older person longing for an earlier time period or event. Perhaps it is caused by seeing or wishing for something that happened when a consumer was younger.

Marketers know how to use those desires. For example, Mattel recently brought back several older toy lines to gain more adult buyers. And now McDonald’s appears to be following suit by launching a limited edition of “adult Happy Meals” that include not only food, but older versions of collectible toys.

Why the adult meals? Well, that’s easy. McDonald’s hopes to lure back older consumers to the fold by reminding them of the pleasures of toys and burgers (or chicken nuggets). For a limited time, when ordering the adult Happy Meal, one gets slightly warped figures of Grimace, the Hamburglar, and Cactus Buddy (new figure).

The collaboration with Cactus Plant Flea Market for the toys is a little unusual for McDonald’s as CPFM represents younger designs and apparel for a streetwear market.

The meals have different packaging and higher prices. Adult Happy Meals range from $14.09 to $17.99. Demand has been high with most franchises sold out of the meals. And buyers are already flipping their toys on resale sites such as eBay with reports of sellers pricing the toys for thousands of dollars (although a recent search show much lower prices).

Don’t you feel like a kid again?

Group Activities and Discussion Questions:

  1. Have students define the target market for McDonald’s. Then have them define the adult Happy Meal target market (demographics, psychographics, etc.).
  2. View ad: https://youtu.be/sYdNnkz1bik
  3. View brief video story: https://youtu.be/p5ZfSlwMz8g
  4. Have students do a search on social media for the toys. What had the response been on social media?
  5. Also have students search resale sites for the toys.
  6. Divide students into teams. Have each team identify a product that could be revamped for a different market segment.

Sources:  Gallagher, J. (13 October 2022). With adult Happy Meals, McDonald’s sparks a collecting frenzy. Wall Street Journal.  

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Netflix Now Offers Ad-supported Subscriptions

It’s long been rumored that Netflix was considering adding advertising to its streaming service. That time is finally here.

Beginning in November in 12 countries (including the U.S., U.K., Australia, Brazil, Britain, Canada, Germany, and South Korea), Netflix will offer a $6.99 per month subscription option (Basic With Ads) that will show four to five minutes of advertising for each hour of content watched. The 15 to 30-second ads will show before and during TV shows and older movies; for new movies ads will only be shown before the movie begins.

Netflix’s subscriber base dropped significantly this year for the first time in a decade. Netflix is showing signs of maturing compared to other streaming services that are earlier in the cycle and must remain competitive. In 2021 ,it release 500 original programs (roughly $20 billion/year) but only a small percentage became hits.

Why the new pricing package? It’s one of Netflix’s key strategies to increase its subscriber base and improve average revenue per user. The company hopes that the new service option will encourage viewers who currently share passwords to get their own subscription, thereby increasing the customer and revenue base. (Netflix estimates that it has 100 million users who share passwords, making it a significant loss of potential revenue.)

For advertisers wanting to promote their brands, the new service is an opportunity to extend their reach to specific segments based on country and genres such as action, comedy, romance, and more.

Netflix isn’t alone in offering new subscription tiers. Disney+ will soon offer an advertising-based subscription in December at $7.99 per month. Hulu has long offered ad-supported subscriptions which accounts for more than half of its customers; HBO Max also offers ad-supported subscriptions.

Will you switch to the advertising version?

Group Activities and Discussion Questions:

  1. Poll students: What streaming services do they use? How much do they spend each  month? Is it worth it? Do they share passwords?
  2. Discuss the product life cycle. Where is Netflix in the PLC? What is the biggest challenge in that part of the PLC?
  3. Show a WSJ video that outlines Netflix’s strategy: https://www.wsj.com/video/series/news-explainers/netflix-hit-a-subscriber-peak-heres-how-it-plans-to-keep-growing/62158AB3-FBBB-4C38-8F72-30F8E27C9CD7
  4. Divide students into teams. Have each team build a price chart that includes the options from streaming services such as Disney, Prime, Paramount, Showtime, Hulu, etc.
  5. Discuss various pricing models. Which model is Netflix using?
  6. Have students develop pricing objectives for Netflix.

Sources:  Krouse, S. (13 October 2022). Netflix’s ad-supported plan will launch in November at $6.99 a month. Wall Street Journal; Sperling, N. (13 October 2022). Netflix to offer cheaper ad option beginning Nov. 3. New York Times; other news sources

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The Cost of Buying Springsteen Tickets

First, a question for everyone… Do you think concert ticket prices are ‘too low’, ‘too high’, or ‘just right’? Going out on a limb here, we bet the biggest percentage of people selected that concert ticket prices are ‘too high’.

Example: Bruce Springsteen ticket prices were for sale for $5,000 and up. And that was if a buyer tried to purchase tickets directly on Ticketmaster.

Another example: Adele concert prices in Las Vegas started at $676 and went for $40,000 (for front row).

Ticketmaster, Live Nation, and StubHub now use “dynamic pricing” for concert tickets. This translates to prices fluctuating wildly; high demand equals high prices. These ticket hubs also have resellers who scoop up blocks of tickets and then resell those at a higher price, often using the original ticketing site to make the sale. The ticketing site earns commission from the double sale.

[Note: Ticketmaster release data that showed only 12% of tickets used dynamic pricing. Overall, only 18% of Springsteen’s U.S. tickets sold for under $100, and only 1% sold for more than $1,000.]

Regardless, buying concert tickets can be both confusing as well as expensive. When to buy? Where to buy? And if we can’t get tickets directly, what will a reseller charge for them?

What would you pay to see The Boss?

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. For Springsteen concert tickets (or any other entertainment), divide students into groups and have each group work on any/all of the six steps.
  4. When setting the price level, assign each team a different model to use (demand-oriented, cost- oriented, etc.).
  5. Debrief the exercise. Compare the various pricing models and discuss advantages/disadvantages of each.
  6. Optional: Have students examine the pricing policies on Ticketmaster, StubHub, SeatGeek, and Live Nation. (Note: Ticketmaster and Live Nation merged in 2010.)

Sources:  Greene, A. and Millman, E. (2 August 2022). Springsteen fans raged over ticket prices. Experts say there’s no easy fix. Rolling Stone.; Lieber, R. (26 July 2022). The case of the $5,000 Springsteen tickets. New York Times.; other news sources.

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