Lay's was a second mover when it introduced its potato chips to rapidly evolving post-communist Hungary. By inserting cash into its potato chip bags, Lay's increased sales dramatically and permanently (i.e., also post-promotion). In contrast, after withdrawing a second "Money in the Bag" promotion, sales fell. Students prepare case A (5 pages) at home. Three in-class cases and a teaching note provide analysis and managerial implications.
To introduce as a managerial decision-making framework a funnel analysis of the consumer decision-making process. The managerial problem is to split a marketing budget between advertising and sales promotions. Two sets of additional teaching objectives can be included: First, deciding when to use sales promotions, how to protect from their risks, and how to evaluate their success. Second, applying various psychological concepts (e.g., attention, memory, categorization, just-noticeable-difference, causal attributions) to marketing and consumer analysis. Case A should be read at home prior to the course, cases B1 to C are in-class material.
- Advertising and sales promotions
- Consumer behaviour
- Allocating a marketing budget
- Funnel analysis
- Hierarchy of effects models
- Setting communications goals
- Consumer decision making process
- Consumer memory and choice
