marketing case studies Flashcards
Factors affecting customer choice; Economic
Quest Apartment;
Hotel occupancies fell by 65% during Covid-19 due to border closures and low consumer confidence
They responded by;
- Cutting prices
- Promoted local tourism and ‘staycations’
Factors affecting customer choice; Government
Vaping;
- In 2024, the NSW govt. launched ‘Every Vape is a Hit to Your Health’ costing $3 million (advertising to change behaviours)
- NSW govt. spent $2.5 million on ‘iCanQuit’ (outreach for helping quitting vapes)
- From March 2024, illegal to purchase unprescribed vapes - causing vape shops to close down and pharmacies to gain more customers
- Phillip Morris International responded by offering loss leader vape DEVICES to pharmacies if they agree to continue to purchase vape refill pods from them
Consumer Laws; Misleading and Deceptive Advertising
Nurofen;
Nurofen offered a range of ‘targeted’ painkillers sold for double to price of regular painkillers
- They had the same basic ingredients
- In 2016 the ACCC fined Nurofen $1.7m and required them to publish newspaper notices explaining the decision
- Increased to $6 million, highest corporate penalty for misleading
Consumer Laws; Price Discrimination
- Uber is market based pricing (supply and demand for rides) preventing shortage of cars and maximises profit
- In 2017, Uber increased trip prices in wealthier suburbs since they are richer
- Legal as it is not anti-competitive
Consumer Laws; Implied Conditions
Lululemon;
- In 2017, they falsely states that customers were not entitled to a, “return or refund under any circumstances” regardless of defects
- ACCC fined $32,000+
- Lululemon stated they solved the issue and that if a product did not perform for a customer, “we’ll take it back”
Consumer Laws; Warranties
Apple;
After a software update, some iPhones froze
- Apple denied replacements if their device had been previously repaired by a third party regardless of the nature of the repair
- ACCC fined $9 million
- In 2022, Apple responded to criticism by selling spare parts for third party repairs
Ethical; Good Taste
H&M;
H&M most followed fast-fashion brand with 9 million engagements per month
- In 2018 they advertised a hoodie labeled, “Coolest Monkey in the Jungle” on a black child model
- Led to backlash on social media and they apologised on its platforms.
- Profit fell 62% in that quater due to the ‘bad taste’ in advertising
Ethical; Truth and Accuracy
Mcdonalds;
- Partnered with the Heart Foundation to get the, “healthy tick of approval” for meals with lower fat content
- They paid 300,000 dollars a year to uphold this
- They received negative publicity so McDonalds removed the tick and the Heart Foundation removed the system in general
Ethical; Products that damage health
Vaping;
- In 2024, the NSW govt. launched ‘Every Vape is a Hit to Your Health’ costing $3 million (advertising to change behaviours)
- NSW govt. spent $2.5 million on ‘iCanQuit’ (outreach for helping quitting vapes)
- From March 2024, illegal to purchase un prescribed vapes
- Phillip Morris International responded by offering loss leader vape DEVICES to pharmacies if they agree to continue to purchase vape refill pods from them
Ethical; Engaging in Fair Competition
Amazon;
- Amazon allows third party sellers on it’s website
- Amazon uses this data to identify the third party sellers’ most popular items and produces their own versions of the items
- Despite of the abuse of market power, businesses continue to sell on Amazon due to it’s marketshare
Processes; Situational Analysis (strengths)
H&M;
- global presence: offer products in 5,076 stores in 74 markets spread across all 6 continents. The company’s global operation reduces risk and enhances sustainability and stability
- competitive pricing: The company strives to become the most sustainable fashion retail by exploiting the flexibility and cost-effectiveness of the fast fashion model to offer high-quality products at a cheaper price
- variety of products, 76th most valuable brand in the world, efficient supply chain, strong online channels
Processes; Situational Analysis (weaknesses)
- controversial products: In 2018, customers from across the world boycotted H&M products for promoting racism. The company used a black child to model for its hoodie featuring the phrase ‘Coolest Monkey in the Jungle.’
- uninspired fashion: The issue with H&M’s fast fashion model is the reliance on fashion trends set by major designer brands. This is a major weakness since fashionistas are drawn to new and radical designs but not existing fashion trends
Processes; Situational Analysis (opportunities)
Australia is a wealthy market with similar fashion tastes to Europe and few brands that cater for all ages. As such, H&M entered the Australian market in 2014
Processes; Situational Analysis (threats)
- global pandemic: the success of global companies like H&M depends on the uninterrupted flow of raw materials and finished products. Lockdowns and quarantine in the event of another global pandemic in the future can interrupt the flow and reduce H&M’s sales and profits
- intense competition: H&M is facing stiff competition from new and old brands like Zara, Macy’s, Gap, Boohoo, and so on. Competitors are all seeking to increase market share and reduce demand for H&M’s products
Processes; Market Research
H&M;
- Use social media data to understand their market through- tracking trends, opinions of key influencers, analyse comments of their 38 million followers on Instagram
- Use Google Analytics and Curalate to track trends in likes and shares for product designs, helps them understand which products to extend or delete
- Helps respond to negative word of mouth (Coolest Monkey in the Jungle), quickly detected backlash
