Tag Archives: shopping

Christmas is in the Air!

Can you smell it? It’s that time of the year when Christmas is in the air! Oh, lift your face and smell the scent of fir trees, pine cones, fresh cold air, and KFC fried chicken in the air! Wait, what, KFC fried chicken in the air? That’s become a Christmas scent?

Yes, KFC decided that Christmas needs more food smells, particularly its famous fried chicken with 11 herbs and spices. To that end, the company recently sold out of its five-pound fire logs that were scented with fried chicken. Relax though, no chickens were harmed and none are burned as part of the fire logs, which are made out of recycled materials. The logs burn up to 2.5 to 3 hours and have a caution applied – burning it may result in a crazing for fried chicken (plus it may attract hungry bears or neighbors).

KFC isn’t the only company applying scents to the holidays. General Mills is also using scents in movie theaters to entice consumers for its Pillsbury cinnamon rolls. General Mills is using scent machines at 200 theaters to push out a subtle scent of freshly cooked cinnamon rolls during pre-show commercials.

Why the emphasis on scents in marketing? Studies have indicated that smell is strongly linked to memory recall. Consumers link scents to memories, making them more inclined to purchase products that generate happy memories.

What smells do you like?

Group Activities and Discussion Questions:

  1. Poll students: What are the scents of Christmas?
  2. Show the KFC yule log site: https://www.kfc.com/fire-log
  3. Show a video about KFC logs: https://youtu.be/b-4Yh8_4vZI
  4. Show the Pillsbury cinnamon theater commercial: https://youtu.be/z_ie4wdXyXM
  5. Divide students into teams.
  6. Have each team develop a marketing tactic using “scents” to improve branding and sales.
  7. What are the drawbacks to this type of marketing?

Source: Minneapolis Star Tribune, Entrepreneur, Ad Week, Fox News, other news sources

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New Shopping Records: Black Friday and Cyber Monday

If you are reading this, congratulations. It means you survived the busiest shopping days of the season: Black Friday and Cyber Monday. And, busy is an understatement. Shoppers took to the stores and online in masses, scoping up deals and getting started on holiday shopping for loved ones (and their selves).

The numbers are nearly as staggering. According to Adobe Analytics:

  • Shopping dollars from Nov. 1 – 26 totaled $58.52 billion
  • Black Friday accounted for a record-making $7.9 billion, including $6.22 billion spent online
  • Top products included Fingerlings, L.O.L. Surprise, Nintendo Switch, Laptops from Dell & Apple, LG TVs, drones, and Amazon Echo
  • Sales traffic vs. revenue by device type:
    • Desktop: 42% traffic for 61% of purchases
    • Smartphones: 49% of traffic for 30% of purchases
    • Tablets: 8% of traffic for 9% of purchases
  • Buy Online, Pickup In-Store (BOPIS) increased 50% from last year
  • Cyber Monday sales reached $7.9 billion, the largest single shopping day in the U.S.
  • Sales from smartphones also hit an all-time high of $2 billion

What did you buy?

Group Activities and Discussion Questions:

  1. Poll students about shopping over the Thanksgiving weekend.
  2. What did they buy? How much did they spend? Gifts or personal purchases?
  3. Did students shop in stores, online, or both?
  4. Purchase volumes by type?
  5. Review the data and charts from Adobe site: http://exploreadobe.com/retail-shopping-insights/
  6. Additional information CNBC Article and video: https://www.cnbc.com/2018/11/24/black-friday-pulled-in-a-record-6point22-billion-in-online-sales-adobe.html
  7. Other video: https://youtu.be/DDhk6O5TSN0
  8. Given the results from holiday shopping, what are three things that retailers must do to continue to meet customer needs?

Source: Adobe Analytics, CNBC, New York Times, Wall Street Journal, other news sources

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Psychological Pricing – Payless Becomes “Palessi”

Pricing is a complex topic – it is both strategic and tactical and is influenced by a variety of factors such as demand, costs, profits, and competition. But probably the most important part of pricing for marketers is its psychological impact. After all, there is a common phrase that “you get what you pay for.” But, is that always true?

Consider a recent experiment by Payless Shoes conducted in Santa Monica. Payless opened a shoe store named “Palessi” in a former Armani store and stocked the store with Payless’ low priced shoes and boots. The shoes, usually priced at $19.99 to $39.99 were examined by a group of influencers who were invited to a grand opening party and asked their opinion of the “designer” products.

The guests, who had no idea they were looking at low-cost Payless shoes, all praised the look, materials, and style of the shoes. That might not be so surprising, but what was astonishing was the amount that the guests were willing to pay for the shoes and boots. The top offer for shoes was $640 – a 1,800% markup!

What are you willing to pay?

Group Activities and Discussion Questions:

  1. 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 importance of psychology in pricing.
  3. Show the Palessi videos: https://youtu.be/xpqqKRlqZfU and https://youtu.be/7YR2bovjfMU
  4. Payless Web site: https://www.payless.com/
  5. For Payless Shoes, 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: Stanley, T. L. (28 November 2018). Payless opened a fake luxury store, ‘Palessi,’ to see how much people would pay for $20 shoes. Ad Week.

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