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9.9 Cases and Problems

Learning on the Web (AACSB)

The Economics of Online Annoyance

You’ve just accessed a Web page and begun searching for the information you want to retrieve. Suddenly the page is plastered from top to bottom with banner ads. Some pop up, some float across the screen, and in some, animated figures dance and prance to inane music. As a user of the Internet, feel free to be annoyed. As a student of business, however, you should stop and ask yourself a few questions: Where do banner ads come from? Who stands to profit from them?

To get a handle on these questions, go to the How Stuff Works Web site (http://computer.howstuffworks.com/web-advertising.htm) and read the article “How Web Advertising Works,” by Marshall Brain. When you’ve finished, answer the following questions from the viewpoint of a company advertising on the Web:

  1. What are the advantages and disadvantages of banner ads? Why are they less popular with advertisers today than they were about ten years ago?
  2. What alternative forms of Web advertising are more common today? (For each of these alternative forms, describe the type of ad, explain how it’s more effective than banner advertising, and list any disadvantages.)
  3. Why are there so many ads on the Web? Is it easy to make money selling ads on the Web? Why, or why not?
  4. Assume that you’re in charge of Web advertising for a company that sells cell-phone ring tones. On which sites would you place your ads and what type of ads would you use? Why?

Career Opportunities

So Many Choices

How would you like to work for an advertising agency? How about promoting a new or top-selling brand? Want to try your hand at sales? Or does marketing research or logistics management sound more appealing? With a marketing degree, you can pursue any of these career options—and more. To learn more about these options, go to the WetFeet Web site (http://wetfeet.com/Careers---Industries.aspx ). Scroll down to the “Careers” section and select two of the following career options that interest you: advertising, brand management, marketing, sales, or supply chain management. For each of the two selected, answer the following questions:

  1. What would you do if you worked in this field?
  2. Who does well?
  3. What requirements are needed to be hired into this field?
  4. Are job prospects in the field positive or negative?
  5. What career track would you follow?

Finally, write a paragraph responding to these questions: Does a career in marketing appeal to you? Why, or why not? Which career option do you find most interesting? Why?

Ethics Angle (AACSB)

A “Late Fee” by Any Other Name

Why is there always time to get a DVD from Blockbuster and watch it, but never enough time to return it within the specified number of days? Are you fed up with late fees? Maybe you should get your movies through a mail-order service, such as Netflix, which lets you hold onto the DVDs for as long as you want in exchange for a monthly fee. But wait: Blockbuster has solved your dilemma by announcing “the end of late fees.” Maybe so and maybe not. The end of late fees isn’t really the end of late fees. As in so many deals that sound too good to be true, there’s some fine print. Here’s how it really works: The bad news is that eight days after the return date of your movie, your credit card is charged for the selling price of the DVD. The good news is that you can get the “sale” removed from your credit card if you return the DVD within thirty days. The bad news is that you’re charged a “restocking fee” to cover the cost to Blockbuster of processing the “temporary” sale. You did avoid a “late fee.” (By the way, not all Blockbuster outlets offer this value-added service; some still keep it simple by charging the time-honored late fee.)

As a business student, you should be wondering whether Blockbuster’s end-of-late-fees campaign makes business sense. You should wonder whether it’s ethical. You may already know that the New Jersey Attorney General has charged Blockbuster with deceptive advertising and filed suit. But even if you know the opinion of one high-ranking legal official, you should (as always) be prepared to form your own. Answer the following questions (being sure to justify your answers):

  1. Did Blockbuster’s decision to establish a no-late-fee policy make good business sense?
  2. In informing consumers about this program, did Blockbuster engage in deceptive advertising?
  3. Were Blockbuster’s actions unethical?

Team-Building Skills (AACSB)

Build a Better iPod and They Will Listen

Right now, Apple is leading the pack of consumer-electronics manufacturers with its extremely successful iPod. But that doesn’t mean that Apple’s lead in the market can’t be surmounted. Perhaps some enterprising college students will come up with an idea for a better iPod and put together a plan for bringing it to market. After all, Apple founders Steve Jobs and Stephen Wozniak were college students (actually, college dropouts) who found entrepreneurship more rewarding than scholarship. Here’s your team assignment for this exercise:

  1. Go to the BusinessWeek Web site (http://www.businessweek.com/technology/content/dec2004/tc2004127_7607_tc185.htm) and read the article “Could Apple Blow Its iPod Lead?”
  2. Create a marketing strategy for your hypothetical iPod competitor. Be sure that you touch on all the following bases:

    • Select a target market for your product.
    • Develop your product so that it offers features that meet the needs of your target market.
    • Describe the industry in which you’ll compete.
    • Set a price for your product and explain your pricing strategy.
    • Decide what distribution channels you’ll use to get your product to market.
    • Develop a promotion mix to create demand for your product.
  3. Write a report that details your marketing strategy.

The Global View (AACSB)

Made in China—Why Not Sell in China?

If Wow Wee manufactures Robosapien in China, why shouldn’t it sell the product in China? In fact, the company has introduced its popular robot to the Chinese market through a Toys “R” Us store in Hong Kong. Expanding into other parts of China, however, will require a well-crafted, well-executed marketing plan. You’re director of marketing for Wow Wee, and you’ve been asked to put together a plan to expand sales in China. To get some background, go to the Epoch Times Web site (http://en.epochtimes.com/news/4-12-23/25184.html) and read the article “China Could Soon Become Booming Toy Market.” Then, draw up a brief marketing plan for increasing sales in China, being sure to include all the following components:

  • Profile of your target market (gender, age, income level, geographic location, interests, and so forth)
  • Proposed changes to the company’s current marketing mix: modifications to product design, pricing, distribution, and promotional strategies
  • Estimated sales in units for each of the next five years, including a list of the factors that you considered in arriving at your projections
  • Discussion of threats and opportunities posed by expansion in the Chinese market