Instructor’s Notes on Text Cases
pay $4.4 billion for rights for all Olympics through 2020, and then in 2015 $7.65 billion for 2021-
2032. Assume you have been charged with the responsibility of determining the IOC and local
A1. The pricing approach Peter Ueberroth used for pricing the 1984 Los Angeles Olympic broadcast
rights makes sense here. He set up a bidding scheme in the U.S. pitting ABC, NBC, and CBS
Q2. Your instructor may assign you to represent either the IOC or any one of the television networks in
A2. The key factor in these kinds of negotiations is what Fisher and Ury6 call the BATNA, that is, the
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Q3. Assume that peace in the MENA region has been achieved. Yes, it’s a big assumption! Now,
Useful References
Echikson, William “Making the Games Run on Time,” BusinessWeek, 2/9/98, pages 66–68.
Hamilton, David P. “Winter Olympics 1998: Made in Japan? Not for Home Team,” Wall Street Journal,
Case 3-3 Marketing to the Bottom of the Pyramid
Questions
1. As a junior member of your company’s committee to explore new markets you have received a
BOP segment. The ultimate goal of this meeting will be a set of general guidelines to use in
2. Marketing to the BOP raises a number of issues revolving around the social responsibility of
marketing efforts. Write a position paper either pro or con on one of the following:
a. Is it exploitation for a company to profit from selling soaps, shampoo, personal computers, and
ice cream, etc. to people with little disposable income?
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not enough to eat—isn’t capitalist exploitation but rather that it stimulates economic growth.
A starting point for the discussion of question 2 might begin with a criticism of the basic ideas of C.K.
Prahalad and C.K. Prahalad’s response to the criticism which follows:
Anuradha Mittal and Lori Wallach, “Selling Out the Poor,” Foreign Policy, September/October 2004, p.
6.
Allen L. Hammond and C.K. Prahalad’s notion that “Selling to the Poor” (May/June 2004) to turn them
into consumers is an “effective way of reducing poverty” is a shameless, far-fetched example of corporate
“poor washing,” through which an agenda for boosting profits is packaged as a poverty antidote.
The authors celebrate how the efforts of Hindustan Lever and Procter & Gamble have resulted in “nearly
poverty trap.” It is estimated that more than 307 million people live below the basic subsistence level of a
dollar per day, a number set to rise to 420 million by 2015.
Hammond and Prahalad somehow conclude that the poor are looking for happiness in single-serve
fashion products. But, around the world, social movements representing the poorest and most
away with poverty; hence our modest proposal to remedy the situation by finding win-win private sector
approaches. It is precisely the scale of the problem that begs for solutions from the private sector. Very
few developing-country governments, and even fewer civil society organizations, can provide services in
Instructor’s Notes on Text Cases
We also disagree with Mittal and Wallach’s underlying premise that they or other critics of globalization
Some pertinent excerpts from this article follow:
The Invisible Market
Why settle for single-digit margins, asks C.K. Prahalad, when there’s greater game afoot?
Your book’s subtitle reads “eradicating poverty through profits.” A rather sweeping promise, isn’t it?
Not at all. My book is about a new world economic order in which there is an invisible market
constituency of 5 billion people. It is invisible to us because of the way we’ve been socialized to think. If
How can they afford to buy companies’ goods and services?
affordable product and a distribution system to make it widely available. But there are some Western
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We continuously make choices for others, and it’s a very elitist attitude. Who are we to say that a kid
shouldn’t have an ice cream or a Coke? Then there’s the other assumption: Poor people make dumb
choices. Well, rich people make dumb choices, too. How many times do people buy PDAs that don’t work
for them?
effect, becomes an extension of the bank. So far, ICICI has developed ten thousand of these groups,
reaching 200,000 women. And ICICI is working with local communities and NGOs to enlarge its reach.
Costco or Sam’s Club being other prime examples.
That’s right, and smaller and smaller packages are 180 degrees opposite to that. Single-serve has some
very interesting implications. If I as a consumer buy, say, five pounds of detergent, I’m stuck with it. If
I’m rich enough or don’t like it, I can throw it away. Poor people can’t afford to do that. Instead, they go to
the village store and buy a small amount when they need it and when they can afford it. It’s equally
economically rational. However, if I buy a single-serve and don’t like it, I can switch to another brand
tomorrow morning. Which leads to a critical question: How do you retain customers? Brands have to
continually prove superior value to customers, and to continuously innovate.
When I’m asked whether poor people have money, I ask, Do you know what interest rates they pay when
they borrow from moneylenders? They say they don’t know. Suppose I told you it’s 300 percent. Say you
offer 25 percent. They’ll think you‘re a savior. Twenty-five percent may be more than 10 percent, which
you give to your best customers, but it beats 300 percent anytime. Sounds good, they say. Then I ask,
Why do you want to charge 25 percent to these people when you charge 10 percent to rich people? They
Instructor’s Notes on Text Cases
And you’re the irritant?
Yes, and this method of refrigeration reduces the amount of electricity supplied, because in a country like
India, 40 percent of the cost of ice cream is electricity in a vending machine. This looks like a simple
So that’s the Prahalad yardstick of democracy-an ice cream on a hot day?
Case 3-4 Continued Growth for Zara and Inditex
This case brings a new type of product/service into our list of cases – the international fashion industry. It
1. What are the ways that Inditex ensures that “fast fashion” is truly fast?
2. What are the important attributes of a “fast fashion” retailer to customers? To store managers?
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3. Why would a retailer introduce their online store country-by-country? Why was Inditex slow to
embrace online sales when they are so tech-savvy in other ways?
4. Briefly describe five opportunities for continued growth during the next five years for Zara’s
parent, Inditex, SA.
5. Pick one of the five and outline the advantages and disadvantages of pursuing that particular
opportunity.
6. Take a look at their new U.S. website. What is good and what is bad about it?
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Case 3-5 A Sea Launch Recovery
We added this case for two specific reasons. First, we wanted to bring more B2B material into the list of
cases, particularly since that what America sells internationally. Second, the data at Space.com allows the
analyst to see the entire market during the last ten years with specific data about both all customers and all
2. Assess its competitors.
The major competitive advantage of Sea Launch is their location close to the equator. Once the students
3. If you had a spare $1 million would you invest it in Sea Launch? Consider the cases of Euro
Disney and Iridium.
4. What are the best opportunities for Sea Launch during the next five years?
Case 3-6 Club Med and the International Consumer
Case Overview
This case explores Club Med’s struggle to understand its international customer and what actions it
America, a huge target market for the company. Decisions include what kind of market research, if any,
Instructor’s Notes on Text Cases
Teaching Objectives
• Understand Club Med’s unique history and service model for customer experience.
• Explore the basic concept of conducting market research to understand a customer—what a
company would like to know, and how to get at the information.
• Apply the concepts of research to methodologies that might be possible to actually
implement the research.
• Consider the benefits and costs of promotional discounts to stimulate purchase or repeat purchase, in
this instance.
• Evaluate Club Med’s longer-term options for promotion and growth.
Introduction & Company Background
Since its earliest days, Club Med’s success has been based on the idea that visitors appreciate a no-
hassle approach of an all-inclusive experience—one price is paid for lodging, meals, drinks, activities—
mostly based on the outdoors and sports, in Club Med’s case. The customer can arrive at the resort and
never really touch his/her wallet/purse again. Club Med’s approach to this “village” concept had been
highly successful since its inception in the 1950’s, even in the highly cyclical environment of the travel
and tourism industry. However, recent financial results have been trending downward, as have the
bookings for the upcoming season, particularly among customers in the “American zone.” Company
executives are considering performing a market research study to better understand its consumer base, as
well as offering a promotional discount to former clients in order to reverse the slide in revenues.
To start the case, students might be surveyed as to their experience with the Club Med concept in
specific, or all–inclusive resorts in general. How many have ever been to a resort like Club Med (responses
might include competitors like Sandals), or a Club Med resort itself? Which one/s? How did you feel as a
“Gentil Membre” (customer) of the resort? What were the strengths and weaknesses of the experience,
from your perspective? Would you return, or recommend Club Med to a friend? What if you were offered
a discount to return? Most students have experience with some sort of resort or a cruise line, to which the
introductory discussion might be broadened if necessary. Questions such as these can lead to an exploration
of the issues and decision points at hand in the case.
Study Questions
Q 1:
Describe the Club Med experience for the international consumer. What are the elements of Club Med’s
unique offering that cross cultural boundaries?
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Q 2: Do you think Club Med should perform a market research study for American consumers? If so, come up
with a list of questions to ask or issues to explore. What would you like to know, and how would you ask the
right questions to get that information?
This question seems a little obvious (why would Club Med not want to perform market
research on an important group of customer?). However, it forces students to not only answer what
Q 3: If you answered “Yes” to a research study, what kind of methods (from those listed in Exhibit 4) do you
think would be effective in performing the research?
This question is designed to get students into the details of market research—what it takes to
actually obtain the information they are looking for. Students should, from their case preparation, be
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Q4: Should Club Med offer the $200 internet “discount coupon” to its past customers for the upcoming
booking season? What effect do you think it would have?
The second decision point of the case is whether or not to stimulate repeat business by giving
former customers (GM’s) a discount to book another trip, preferably in the immediate season. This in
itself might be an interesting sub-question—is now the time to for the discount, which might provide a
short-term “shot in the arm,” but what about long-term promotion, brand-image, etc.?
For questions such as these, cold-calling a student, as in “Would you send out the coupons?” then
asking others if they agree or disagree usually gets discussion going, as does a “vote,” usually after
select students have given their opinion. Key to this issue is connecting the promotion decision to the
research question—as in, “How do we know whether giving a discount to our customers is a good idea,
when we don’t know much about the customer in the first place?”
Updates
As the case scenario is fictitious, there is no epilogue to the decisions faced (nor are such epilogues key to
the main task of case analysis, in my opinion), but here are some articles (also listed as resources at the
back of the case) that provide some interesting updates and commentary about current Club Med business
activities:
• Terrero, Ruthanne. “Club Med Focuses on Growth, Going Upscale and Travel Agents.”
TravelAgentCentral.com, May 6, 2015.
http://www.travelagentcentral.com/all-inclusive/club-med-focuses-growth-going-upscale-and-
travel-agents-51335
• “Club Med turns further away from French roots.” The Local France, January 2015.
http://www.thelocal.fr/20150106/club–med-turns-away-from-french-roots
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• “Club Med collides with Cirque du Soleil to Get ‘Creactive.’” HotelChatter.com, June 26, 2015.
http://www.hotelchatter.com/story/2015/6/18/182733/176/hotels/Club_Med_Collides_With_Cirq
ue_du_Soleil_to_Get_’Creactive‘
• “Club Med Launches New Brand Campaign Worldwide.” PR Newswire, March 18, 2015.
http://www.prnewswire.com/news-releases/club-med-launches-new-brand-campaign-worldwide-
198838061.html
• Club Méditerranée Annual Report, 2013.
http://www.clubmed-corporate.com/wp-content/uploads/2014/02/VCONSO-ENG-VDEF.pdf
• Varela, Thomas. “How the Club Med War Was Waged.” Wall Street Journal, February 11, 2015.
http://www.wsj.com/articles/how-the-club-med-bidding-war-was-waged-1423692196
• “Club Med’s Global Expansion Plan Will Introduce 15 New All-Inclusive Resorts By The End Of
2020,” Mar 8, 2018, https://www.prnewswire.com/news-releases/
Case 3-7 Gillette: The 11-Cent Razor, India, and Reverse Innovation
Case Overview
After
moderate success with razor introductions in India, Gillette took a different approach
when it designed
and marketed the Gillette Guard. Through market immersion, Gillette’s staff
studied the Indian market
and learned about the specific needs of Indian consumers. The Gillette Guard
became the market leader in
only six months, moving Indian consumers away from using low quality
double–edge razors. Gillette also
developed an operations model to efficiently produce these low–c ost
razors in India, providing local jobs
and ensuring stable costs. The success of the Gillette Guard makes
for an interesting class discussion. The
primary question is if Gillette should launch the low-cost razor
in the US, risking disruption of the market
and cannibalization of sales of high-margin razors such as
the Gillette Fusion ProGlide.
Teaching Objectives
• Examine and describe Gillette’s “razor-and-blades” business model.
• Articulate issues relevant to strategy and marketing in the Base of the Pyramid.
• Apply the concepts of sustaining vs. disruptive innovation to the problems faced by the
case
protagonist.
• Analyze Gillette’s product development process.
• Evaluate Gillette’s strategic options.
Introduction & Company Background
Since its earliest days, Gillette’s success has been based on developing one innovative product
after
another. By continuously developing products to match its slogan, “The Best a Man Can Get,”
Gillette has
stayed at the top of the shaving industry for over a century. A good way to begin class and
to introduce
students to Gillette’s latest innovation is to show a recent Gillette commercial. The Gillette
“Masters of Style”
ads provide a brief introduction to the Gillette Fusion ProGlide razor (specifically, the
more advanced Fusion
ProGlide Styler), featuring celebrities with highly styled facial hair. This high-
price, state-of–the-art razor
is much different from the Gillette Guard, which is targeted to customers at
the Base of the Pyramid (BoP).
Instructor’s Notes on Text Cases
Students can be surveyed to develop a profile of the shaving habits of the class. Questions you may
wish
to ask include: How many students use a manual vs. electric razor? How many use a disposable vs. a
“razor–
and-blade” (aka “system razor”)? How many use a Gillette product? Finally, how many use a
Fusion ProGlide?
The students can be probed a bit further to find out why they use the Fusion ProGlide,
or why they use a
competing product. Despite the fact that the Fusion ProGlide is aimed at men, the
case is also relevant to
female students, who face similar decisions with regard to shaving products.
Study Questions
Q 1: Describe the razor-and-blades business model.
Gillette’s early history provides a basis for understanding the current issues at hand. King Camp
Gillette
introduced his first razor in the early 1900s. Initially, the razor was sold at a high price ($5 or
roughly $130
in 2010 dollars). The blades were relatively inexpensive, at $1 for a year’s supply. After
Next, Gillette’s strategy of continuous innovation can be discussed. It is worth mentioning that
until
1971, only single-blade razors existed. Each time the number of blades increases, the
“improvements” are
often mocked as unnecessary. For example, after the release of the Trac
II
(two
blades) in 1971, Saturday
Night Live ran a commercial for the three-bladed Triple-Trac, with the slogan
Q2: How and why do razor consumers in the US differ from those in India?
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quantities
of money to spend as individuals, as a group, they represent a large source of potential revenue
for global organizations like Gillette. Some statistics: The 20 biggest emerging economies have more
Q3: How did Gillette’s product development process differ for the Gillette Guard as compared to its
previous product development process?
A key point of discussion in this section is reverse innovation. A reverse innovation is any
innovation
that is initiated in a low-income country. The traditional path of a new innovation is
development in wealthy
Western countries, where plenty of capital is available for investment into research
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Gillette also went local with its manufacturing and distribution process. The low cost of labor
Q4: Should Gillette release the Gillette Guard in the US? Should it launch the product in low income
countries?
The success of the Guard has created an opportunity for Gillette to complete the reverse
innovation
process by releasing the razor in the US. The price of the Guard in India is 3% of the
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Updates
Here are some articles (most listed as resources at the end of the case) that provide some interesting
commentary about Gillette in India:
• Ng, Serena and Paul Ziobro. “Razo Sales Move Online, Away from Gillette.” Wall Street
Journal, June 23, 2015.
http://www.wsj.com/articles/SB12147335600370333763904581058081668712042
• Reddy, Srinivas and Christopher Dula. “Gillette’s ‘Shave India Movement.’”
Ft.com/management. November 4, 2013. http://www.ft.com/intl/cms/s/0/8da786b8-37e7-11e3-
8668-00144feab7de.html#axzz3fJSG70fJ
• Coleman-Lochner, Lauren. “Why Proctor & Gamble Needs to Shave More Indians.” Bloomberg
BusinessWeek. June 9, 2011.
http://www.bloomberg.com/bw/magazine/content/11_25/b4233021703857.htm
• “How Gillette Execs Spent a Fortune Developing a Razor for India Using MIT Student Focus
Groups… Without Considering the Country’s Lack of Running Water.” Daily Mail October 3,
2013. http://www.dailymail.co.uk/news/article–2443191/Gillette-spent-fortune-Indian-razor-
forgetting-countrys-running-water.html
• “Gillette India standalone net profit rises 1.57% in the September 2018 quarter,” Business
Standard, November 3, 2018. https://www.business-standard.com/article/news–cm
Conclusion
This case provides an opportunity to highlight the dynamic nature of competition in a
Instructor’s Notes on Text Cases
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This instructor’s note is a version of a note developed by Ryan Atkins, Lecturer at The University of Georgia,
Terry College of Business. It is used by permission of GlobaLens, a division of the William Davidson Institute
at the University of Michigan.
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CASE 4
DEVELOPING GLOBAL MARKETING STRATEGIES
Case 4 – Developing global Marketing Strategies
4-1 Tambrands – Overcoming Cultural Resistance
4-2 Futuram’s Risk Management Strategy
4-3 Sales Negotiations Abroad for MRIs
4-4 National Office Machines – Motivating Japanese Salespeople: Straight Salary or Commission?
4-5 AIDS and Condoms
4-6 Making Social Responsibility and Ethical making Decisions: Selling Tobacco to Third-World
4-7 The Obstacles to Introducing a New Product in a New Market
4-8 Mary Kay in India
4-9 Noland Stores Cleans Up its Act
Case 4–1 Tambrands – Overcoming Cultural Resistance
This case may be too DELICATE for some students. The Instructor is advised to take this into
consideration before assigning this case. However, it is a real live case and P&G is having success with
Here are some examples:
So here it is. Again. That time of the month. If you’re like the majority of American women, your
most pressing concern is keeping your menstrual period hush-hush. You’re not about to grab a
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neatly in the paneled basement of Finley’s Maryland home, it has received a great deal of attention
societies beat, isolate or perform female circumcision on a girl upon her first period, called menarche.
It’s no wonder women take pains to hide their bleeding.
“. . . he grew up in an Irish Catholic home with six sisters. “I never knew that anyone was menstruating in
my house,” he says. “It was totally secretive. It was dirty. It was not proper to show or talk about or admit
to. “In my mother’s generation it was looked upon as ‘the curse,’ he adds. “That’s a pretty negative
masturbate.
Undeterred, Gertrude hired registered nurses to give lectures, sent women door-knocking and took on
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Consumer products giant Procter & Gamble launched a Web site for teenage girls with
information on puberty and relationships and little dancing tampons at the bottom of the main
page. The Web site, www.beinggirl.com, was designed with the help of an advisory board of
teenage girls, P&G said.
Sara Nathan, Levi’s to Launch “Cool” Ad Campaign,” USA Today, July 27, 2000, pp. 01B.
Near the beginning of this century the Johnson and Johnson company produced the first
commercial disposable pad. It was made of cotton covered with gauze, but the retail industry
shunned the product.
According to the book, The Curse: A Cultural History of Menstruation, this happened
because “turn–of-the-century morality prevented advertising these ‘unmentionables.’” The
pads did not reach many women and were eventually withdrawn from the market.
It was only after the First World War had ended that another company, Kimberly Clark, was
prepared to once again try to market a feminine napkin. They decided to do this after it was
learned that some resourceful Red Cross nurses had replaced obnoxious menstrual rags with
Cellucotton, the surgical material the company had supplied to dress war wounds.
In 1920, after intensive research and market testing, the company succeeded in producing a
viable consumer product for women. The first napkins, bulky by today’s standards, sold for
60 cents for 12 pads packaged in a “hospital blue” box. A customer didn’t even have to
request the product by name; all she had to do was put her money in a box near a pile of the
unmarked packages and walk out of the store.
Almost immediately the product was the center of controversy. Many drug and department
stores refused to stock the Kotex pads. One Woolworth store in San Francisco was forced by
a men’s organization to take down a window display of the sanitary pads.
Media outlets were aghast at the idea of advertising a product associated with something that
was regarded as a “hush-hush” subject. Ladies Home Journal was the first magazine willing
to accept an ad for sanitary pads, but this was done with the understanding euphemisms and
great discretion would be paramount. Later, magazine publishers felt somewhat reassured
when some ads stressed that women doctors had played a role in design improvements.
About the same time Kimberly Clark was pioneering its first sanitary pad, a young man on its
staff was experimenting with a bizarre-looking device—a condom in which he had punctured
holes and filled with the same material used in the pads.
He was thrilled with his innovative achievement, which he contended could be used by
menstruating women. His father, Dr. George H. Williamson, who was Kimberly Clark’s first
medical consultant during the development of the sanitary pad, was shocked by his son’s
creation.
He said, “Never would I put such a strange article inside a woman.” He also warned that
marketing such a product would be a legal nightmare. “Don’t discuss this with anyone
because some damn fool will want to put it on the market and you’ll be in trouble!”
But clever ideas seldom disappear and, 10 years later, another company bought the patent for
a tampon prototype from a woman who claimed her device would be “a different method of
taking care of menstruation.” Given the name Tampax, the new feminine product was also
destined to generate widespread outrage.