Case studies

Since 1981, the U.S. federal government has operated a price support program to help sugar beet and sugar cane producers and processors. This complex program works through a combination of loans, import quotas, and duties. As a result, sugar prices in the United States are significantly higher than world prices. For example, in December 2001, U.S. consumers paid 22.9 cents per pound, while the world price was just 9 cents per pound. The General Accounting Office estimates that the total cost to consumers is $1.9 billion a year. Uses a simple demand-and-supply framework with real-world data to assess the economic and political consequences of the U.S. sugar program.

To illustrate welfare concepts such as consumer surplus, producer surplus, and dead-weight loss in a concrete, real-world market context.

This exercise asks students to develop criteria that Target Stores should use in evaluating strategic brand alliances to support its positioning as a store where you can “Expect More. Pay Less.” Students are then charged with proposing a new strategic partner for Target that meets the criteria they identify. Background information about the Target “guest” and past strategic alliance is provided.

The case is designed to help students appreciate how brand positioning both guides and is affected by a firm's strategic partners.

In 2005, a wine snob in the critically acclaimed movie Sideways denounced merlot. Subsequently, sales of merlot, including sales for Terlato's Rutherford Hill merlot, declined significantly. Students are asked to evaluate three strategies---rebranding, cutting price, and launching television advertising---that Terlato is considering to reverse this decline. The case should be used with “Student Supplement: Terlato Wines International: Background Note on the U.S. Wine Market and Terlato Wines International,” Case #KEL359.

Students explore the challenge of managing a brand when external factors cause a decline in category demand. They also explore the role of pricing and advertising in managing a small, luxury brand.

In 2012 several retailers, including Amazon and Walmart, experimented with same-day delivery. Home delivery of pizzas had been a very successful model in the United States and had been copied all over the world. In contrast, home delivery attempts by companies like Kozmo and Urbanfetch had failed and both companies went bankrupt. The goal of this case is to build a framework that helps students identify the factors that influence the success or failure of home delivery models.

After analyzing and discussing the case, students should be able to:

• Build a basic framework identifying supply chain drivers that are influenced by a firm's decision to offer same-day home delivery

• Understand the tradeoffs that influence the success of a same-day home delivery model

• Identify qualitative factors to be considered when deciding between non-U.S. facility locations, including transportation time variability, consumer perceptions, and cultural differences

Build a basic framework identifying supply chain drivers that are influenced by a firm's decision to offer same-day home delivery

Understand the tradeoffs that influence the success of a same-day home delivery model

Identify qualitative factors to be considered when deciding between non-U.S. facility locations, including transportation time variability, consumer perceptions, and cultural differences

The director of marketing and operations for a financial newsletter must deal with a host of issues that surround the practice of renting mailing lists and soliciting new subscribers by direct mail. The case can be used to introduce the concept and calculation of customer lifetime value.

This case examines the public controversy that erupted over the increasingly high price of EpiPens. Mylan Inc. (Mylan), a generic drug maker, bought the EpiPen product line from Merck in 2007. Since that time, the company both invested in marketing to raise awareness for the drug and dramatically increased the price, lifting it from $100 to $600 per two pack in the U.S. In 2016, simmering consumer anger about the high prices of pharmaceutical drugs finally reached a boiling point and a media firestorm ensued. The case challenges students to think about the role of fairness in pricing. How can Mylan justify the dramatic price increases? How can it justify the variation in prices across countries, as an EpiPen is priced at an equivalent of $85 in France? The case challenges students to think about how they would handle a public controversy. The EpiPen case is well suited for students in MBA, MBA for Executives, and executive education programs. For MBA students, it can be placed in first-year marketing, pricing, or marketing communications courses. For executives, it can serve as a vehicle to discuss both ethical issues of pricing and how to handle a public controversy.

In 2013, Under Armour had $2.3 billion in sales yet only $500 million came from its women’s apparel, and the company was ready to expand into the female market segment. The “I Will What I Want” global women’s marketing campaign was the largest Under Armour had ever run. Founder Keven Plank and his team launched the campaign on a multichannel platform, with social media at its core. The campaign’s success surpassed what Plank had imagined, and he is left wondering where to take Under Armour’s advertising and marketing next. This case has been used successfully in a marketing course and would be suited for any class with a focus on interactive media, technology, and multichannel marketing.

Pancho’s Burritos is a high-end fast-food restaurant located in Charlottesville, Virginia. Due to a recent surge in customers, the lines at the restaurant during peak hours are becoming very long and causing excessive customer waiting. To improve current customer wait times and plan for future growth requirements, Francisco “Pancho” Escoba, the proprietor, wants to get a better understanding of the current operational capacity. The key decision Escoba must make is how to redesign his burrito-making process to increase the capacity and reduce customer wait time.

Suitable for an undergraduate or MBA course, the case can be used in an introductory operations course to teach capacity analysis and queuing. The case provides a relatable and understandable setting for students without an operations background to gain a better grasp of basic course concepts and illustrates how interactions between capacity and queuing affect one another. As an exam or review case it works well because it contains standard process calculations that all students should know how to perform.

Hundreds of thousands of would-be hoteliers have been popping up all around the world, hoping to rent their own homes and apartments to complete strangers through a service called Airbnb. The goal of Airbnb’s aspiring hosts was to use the company’s website to attract guests who were willing to pay the highest rates to stay in their homes for a short time. For Airbnb, the goal was to improve customer review performance so it could, in turn, increase profits. How could the company achieve its goal? Enter text mining, a technique that allowed businesses to scour Internet pages, decipher the meaning of groups of words, and assign the words a sentiment proxy through the use of a software package.

In order for text mining to be useful for Airbnb, its marketing professionals first had to gain access to customer review data on the company’s own website. The team then had to analyze the data to find ways to improve property performance. Was the team going to be able to leverage this large amount of data to determine a strategy going forward?

Joe Smith, senior director of merchandise management at Beautiful Bags (BB), was about to place a large order for the upcoming winter season. He had to decide how many pieces he should order of each product. But another big question whether BB should source the product from its domestic manufacturing facility, its Chinese suppliers, or some combination of the two given the timing needs, labor costs, minimum order requirements, and BB's expanding product assortment?