Lay's Potato Chips in Hungary (C): The Second ‘Money in the Bag’

Published 07 Jan 2006
Reference 5334
Topic Marketing
Region Europe
Length 9 page(s)
Language English

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.

Teaching objectives

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