HOLY CROSS COLLEGE OF CARIGARA

Carigara, Leyte

IN PARTIAL FULFILMENT FOR THE REQUIREMENT

OF THE SUBJECT
BUSINESS 1
(Case Analysis)

Presented by:
Abrera, Christain
Llames, Ronald
Naldo,Eunyza

Presented to:
Mrs. Teresita Capaycapay
(Instructor)

IN-YOUR-FACE ADVERTISING

Furious, the clothing saleswoman stated, Its an invasion of our privacy. Its dangerous.
Its annoying. I have made a concentrated effort to boycott any products advertised here.
Another woman said, Its so unnecessary. Anyone who would advertise in doctors waiting
rooms is an immediate turn off. I resent it.
What raised the anger of these working women? The answer: captive advertising. Found
in movie theaters, doctors offices, airports, health clubs, and a growing number of other
locations, captive advertising barrages consumers with advertising messages while they are
engaged in another activity, such as waiting or exercising. One marketing professor warned,
People are going to become more and more violent in their reactions and in terms of trying to
avoid such gimmicks.
The use of what is disparagingly called in-your-face advertising is growing rapidly. A
company called Health Television Network supplies programming for health clubs that is 70
percent exercising and health shows and30 percent advertising. Turner Broadcasting has
launched the Airport Channel to capture people waiting for planes, and another company has a
checkout channel barraging people standing on line in supermarkets.
Members of the Vertical Club, a health club for the well-to-do, launched a petition against
captive advertising that was sent to all companies that advertised on the Health Television
Network. Criticizing the advertising as the equivalent of a commercial police state, the
petitioners also attacked the network through press releases. A spokesperson for Dannon
Company, which advertises on the network, remarked ruefully, Obviously, we arent reaching
someone if theyre annoyed by the message. A manager at Playtex, Inc., called a leader of the
petitioners to assure him that the company would pull its ads.
Some companies have long had a policy of not associating themselves with any type of
captive advertising. Walt Disney Productions, for example, has a general policy of refusing to
allow movie theaters to show advertisements for products or services prior t projecting a Disney
movie.
Executives at Health Club Television decided to defy the petitioners. One manager called
them a bunch of malcontents who represented only a minority of club members. According to
this spokesperson, marketing research indicates that over 80 percent of people like Health Club
Television.

Questions:
1. Define the problem of in-your-face advertisements from the perspectives of Health
Club Television, health club itself and the advertising company?
The problem from the perspective of Health Club Television is that the members
of the vertical club, a health club for the well-to-do, launched a petition against captive
advertising that was sent to all companies that advertised on the health television
network.
From health club itself it might be an a shame attitude for that launching a petition
against captive advertising that was sent to a companies who make advertisement in
health television network.
Advertising company, problem is refusing to allow movie theaters to show
advertisements for product or services prior to projecting a Disney Movie.
2. What consumer behavior concepts concerning consumer motivation and affect apply to
this case?
Consumer Affect
3. What are the managerial implications of these consumer behavior concepts for each of
the entities involved?
Managerial implications are Consumer Affect and Reactance.
Consumer Affect- Market Research- identify how consumers with different levels
of affect intensity respond to alternative ads in which people are having fun.
Segmentation- segment the market on affect intensity.
Promotional strategy- in ads shows people having fun because
they are using their frequent flier miles.
Reactance- Promotional strategy- uses as an advertising theme idea that frequent
flier miles give consumers the freedom to go and do what they want.
Product development- when changes in the structure of the frequent
flier program are made, carefully consider costumers desire for behavioral freedom.
4. What are the ethical implications, if any, of in your face advertising
Ethical implications, for big businesses company it will be a great help for
them to popularize their product through in your face advertisements. While in negative
side in your face advertisement are not good for everybody like for example young
people who does not concern of what product they take. They are influenced of what they
saw in their nature even though they dont need of that product they will buy because of
what in your face advertisement done.
MATERIALISM WANES AND IZODS SALES PLUMENT

When the United States went into a full-scale recession in 1991 and 1992, companies
selling luxury goods had to scramble. It was so sad. Sales of Dom Perignom champagne were
flat, and Cartier couldnt move its $10,000 watches. Ferraris selling for $300,000 in 1989
languished at $150,000 in 1991. Poor babies!
Carolyne Roehm, the wealthy fashion designer, commented on the new restraint in
spending. She said, Its almost looked down upon. The son of billionaire Marvin Davis said
that people have stopped talking about how much money theyve just made, what boat their
going to buy or what fancy vacation theyve just taken. The chairman of The Sharper Image
said that in this environment People want to live well for less. As a result, during the 1991
Christmas season the company carried so many $25 items that people will be surprised its the
Sharper Image.
One suffering wine merchant came up with an interesting marketing strategy. He invited
his best clients to a polo match and served free French Burgundy and Bordeaux wines costing as
much as $100 a bottle. His goal was to convince his customers that spending $100 on a bottle of
wine for your friends is not the same thing as conspicuous consumption.
Meanwhile Crystal Brands, Inc., was attempting to create a marketing strategy for its
troubled Izod Lacoste polo shirts. Its manager decided to bring out a new version of its shirts
with a crest to be priced at $30 to $35 a full 20 percent lower than the shirt with the alligator on
the front. (Actually, the crest is a crocodile. ) In the early 1980s the company sold $450 million
worth of the Izod shirts. At one time Saks Fifth Avenue devoted an entire wall to the 24 shades
the shirts came in, but by the late 1980s, most retailers had phased out the brand Price
discounting by retailers and a plethora of cheap knocks offs had seriously tarnished Izod.
In dissecting Izods problems, one analysis argued that a consumer rebellion was
underway against visible logos on everything from shirts to jeans to cars. He said people today
are embarrassed to say that identify with the logo. They want to say Im a more interesting and
individualistic person.
Izods strategy was to market its lower priced crested shirt under the Izods brand to
retailer selling moderately priced merchandising and sell to upscale reassocciated with under
chemise lacoste label the big question was whether the cheaper crest shirt would harm sales of
more expensive alligator shirt. The next people avoiding symbols of excess, consumer would go
for the gator.

Unfortunately, the answer was yes to the first question and the resounding no to the
second. In 1994 the company sold its entire asset to Philips Van Heussen Corporation, which is
still trying to resurrect the struggle brand.

Questions
1. Identify the problems faced by Izod Lacoste.
The dissecting Izods problems, one analysis argued that a consumer rebellion was
underway against visible logos on everything from shirts to jeans to cars. People today are
embarrassed to say that identify with the logo. They want to say Im a more interesting and
individualistic person.
2. Discuss which consumer behavior concepts from this chapter apply to the case.
In this chapter the discussion will cover almost all of the said consumer behavior
concepts, namely; Psychoanalytic, Traits Theory, Self Concepts, and Psychographic. But it
focuses greatly from Psychoanalytic and Self concepts.
First, the psychoanalytic behavior concept, it says that it has a major impact to human
behavior. According to Frued human personality results from a dynamic struggle between inner
physiological drives (hunger, sex and aggression) and social pressure to follow laws, rules, and
moral codes. He proposed that human being have a conscious, preconscious, and unconscious
mind. In this case people dont feel that they are associated in purchasing those shirts with logo
of an alligator. Because they are embarrassed to say that they are identify with logo.
Second, Self concepts simply represents the totality of the individuals thoughts and
feelings having reference to himself as an object. This perception of themselves forms part of the
basis for their personality, by acting on it; consumers maintain their self-esteem and gain
predictability in interaction with others. In relation to that, with regards to the application to this
chapter, people react on it with contradiction to its theory; people dont want any associations to
their lives. They want to say, Im a more interest and individualistic person. As a result, Izods
formulate a strategy to prevent this problem, and that is to impose lower price in every items.

THE COMMUNICATION OF SELF TO OTHERS VIA SYMBOLIC PRODUCTS

Persons selfconcept

Reference
group

Step 3

Step 1

Step 2
Symbolic Product
Step 1- person buy products that is symbolic of self
Step 2-reference group associates product with person.
Step 3-reference group attributes to person the symbolic qualities of
the product.

3. Discuss the managerial implications of the consumer behavior concepts relevant to the
problems faced by Izod Lacoste.
Managerial Implications of Consumer Behavior Concepts in Materialism Wanes

and Izods Sales Plummet Case

Consumer Behavior Concepts

Managerial Implications

Psychoanalytic TheoryMarket Research. Perform studies to identify psychoanalytic

Characteristics of target market.
Segmentation. Identify peoples choice and preferences and
Conduct forecasting activity.
Promotional Strategy. Develop ads that appeals to the segments
Based upon the groups preferences, evaluations and
profitability.
Self-concept

Market Research. Perform studies to identify self-concept

Characteristics of target market.
Promotional Strategy. Develop advertising themes that appeals
to ideal self-concept identified.
Product Design. Identify the self-concept aspirations of the
target
Market, and develop programs that will help recruits to achieve
These aspirations.

A FOUL TASTE AT PERRIER

Perrier Group of AMERICA, Inc., the U.S. unit of Frances Source Perrier S.A.,
announced a highly embarrassing product recall on February 9, 1990, after North Carolina
regulators released a report stating that this high-priced bottled water was contaminated with
benzene, a poisonous liquid shown to cause cancer in laboratory animals. Even though the U.S.
Food and Drug Administration (FDA) said that the benzene levels did not pose a significant
short-term health risk, Perrier management decided to request the removal of the brand from the
supermarkets and restaurants in the United States and Canada.
A Source Perrier official stated at the time that the company believed the contamination
could be traced to an employees mistaken use of fluid containing benzene to clean the
machinery on the bottling line that fills Perrier bottles for North America. Initially, the recall
affected only the United States and Canada-an inventory of some 70 million bottles. Soon it was
made worldwide, however, because Dutch and Danish officials also found benzene in some
Perrier bottles.
The incident turned into a public relations disaster as the companys explanation for the
recall kept changing. After traces of benzene were found in Perrier bottles in other parts of the
world, company officials altered their original explanation. Benzene, they now said, is naturally
present in carbon dioxide (the gas that makes Perrier bubbly) and is normally filtered out before
the water is bottled-except that workers had inexplicably failed to change the filters. Perrier still
insisted that its famous spring in Vergeze, France, was unpolluted. These inconsistent statements
further raised consumers suspicions.
The big question was what long term effects the contamination incident would have on
Perrier, which had positioned itself as naturally pure water. The strong underpinning for the
success of bottled waters is their perceived safety compared with ordinary tap water. Tom Pirko,
a beverage consultant, described the revelations of contamination as the the worst possible thing
that could happen to a bottled water company/. Purity is the franchise. The last possible thing
that Perrier can afford to have happen is for the American public to think that there is benzene in
their spring, whether it gets filtered out or not.
Complicating the companys problem was the fact that the product disappeared from the
marketplace for three to five months-a hiatus that severely tested consumers loyalty. As one
marketing expert commented, When a brand is consumed daily, out of sight is out of mind.
The prospect of a Perrier-free market seemed to pose only minor difficulties for supermarkets
and restaurants. Typically, bars and restaurants carry just one sparkling brand, an analyst noted.
Until now that has Perrier. Now other sparkling waters will have a chance to get into Perriers
stronghold. Tom Kaplan, general manager of a restaurant in Los Angeles, noted; Now

consumers have decided that other brands are better or at least as good, so Perrier no longer
holds the monopoly on water.
The recall came at a tough time for Perrier. In 1989 Perrier was the leading imported
water, holding about 6 percent of the U.S. bottled water segment. But success brought intense
competition from other bottled water brands in the 1990s. While the total category was growing
at about 10 percent annually, Perriers growth slowed to about 5 percent a year. In an effort to
regain market share lost during the months-long recall, Perrier Group spent $25 million in a U.S.
advertising campaign whose message was; Perrier. Worth waiting for. (In 1989 Perrier Group
had spent just $6 million on U.S. advertising.) In the opinion of marketing experts, the mere
increase in advertising was a good start, but the ads themselves did little to ease the problem.
Many find them lacking in sincerity and credibility. Perhaps more dangerous to Perrier was that
while it was off the market some consumers made the discovery that any bottled water would do.
Exacerbating the problem was the FDAs decision to make Perrier drop the words Naturally
sparkling from its label since its investigators had discovered that Perrier artificially carbonates
its water after taking it out of the ground.
By 1995 Perrier sales had fallen to one-half their 1989 peak. Even so, the brand was still
number two in the marketplace- a distant second to Evian. Some experts think that because the
brand endured through the crisis, it has a chance of coming back. One recommended strategy is
to focus on building relationships with bars and clubs in order to broaden distribution.
One comeback strategy management did employ was to bring out new brands that do not
have the Perrier name attached to them. By 1996 the company owned seven of the top ten brands
of bottled water-and the future of bottled water looks good. Sales of this product already
represent 10 percent of the total beverage market, and they are growing. Overall sales of bottled
water have increased by 25 percent since 1990, and consumers are more and more worried about
the quality of municipal water.

Questions
1. Define the problems Perrier faced.

Perrier group of America,Inc. the U.S unit of Frances Source Perrier S.A announced a
highly embarrassing product recall on February 9, 1990, after North Carolina regulators released
report stating that this high- prices bottled water was contaminated with benzene, a poisonous
liquid shown to cause cancer in laboratory animals. Even though the U.S Food and Drug
Administration (FDA) said that the benzene levels did not pose a significant shot-term health
risk, Perrier management decided to request the removal of the brand from supermarkets and
restaurants in the United States and Canada. Complicating the companys problem was the fact
that the product disappeared from the marketplace for three to five months- a hiatus that severely
tested on costumers loyalty ,When a brand is consumed daily, out of sight this out of mind.
Now, other sparkling water will have a chance to get into Perriers stronghold

2. Identify the consumer concepts related o beliefs, attitudes, and behaviors not relevant to
this case. What does each concept say about the case?

A. RELATED TO BELIEFS
Consumers of Perriers Group believe that this group positioned itself as a
naturally pure water. The strong underpinning for the success of bottled water is their
perceived safely compared with ordinary tap water. People seek products and services
that will solve their problems and fulfill their needs in other words, that have
attributes that will provide recognizable benefits.
B. RELATED TO ATTITUDES
Consumers took a negative view towards the product. Its contingent that they
may automatically resist themselves from buying. As one marketing expert
commented, When a brand is consumed daily, out of sight is out of mind
C. RELATED TO BEHAVIOR
Consumer behavior consists of all the actions consumers take to acquire, use and
dispose of products and services. In this case consumers might not buy the product anymore;
they might provide word- of mouth information about what happened to Perrier to another
person.

THAT GREAT NEW PEPSI CAN

The sleek Lamborghini pulls up to the Halfway Caf somewhere out in nowhere. Its gullwing door opens, and the beautiful form of super model Cindy Crawford emerges from the
cockpit. Writing in Advertising Age, columnist Bob Garfield the scene this way: Simultaneously
smoldering and insouciant, she emerges from the gull-wing door of her Lamborghini Diablo like
Venus on the half shell. We are way out in the country, at the crossroads of astonishing loveliness
and transcendent sexuality. Watch her as she ambles sleekly across the dusty parking lot. This is
no mere stroll; it is ballet for glands- her supple, sinuous, slow motion feline languor on the
surface concealing the coiled, smoldering, feral cat beneath. In other words what a dish,
Crawford glides to the soda machine, insert some coins, and a Pepsi emerges. She throws
back her head,
But Crawford is not alone. Two young boys, perhaps 10 years old, happen upon the
scene. Drawn by curiosity at the sight of the car, they move closer to the vision and hide behind a
fence. They are enchanted, their mouths agape.
The scene shifts rapidly between Crawford and the peeping boys. Finally, after having
been refreshed, she turns to leave. is that a great new Pepsi can, or what? the camera then cuts
back to Crawford, and a voiceover narrators says, introducing a whole new look at Pepsi and
Diet Pepsi. the camera again moves to the boys, and the second boys declares, Its beautiful.
In analyzing the ad Bob Garfield raised the question of whether it objectifies women. His
answer: yes and no. he said that the ad does objectify Crawford in a wry and self-conscious
way, toying with mens libidos at least partly to make light to them. He continued not the old
Milwaukee Swedish bikini team, which uses a coarse parody of mens adolescent preoccupations
as a transparent pretext to trot out a paratroop squad of busty blondes wiggling their pulchritude
at the camera. Instead, Garfield suggested that the Pepsi ad explores meaning of beauty,
whether in the form of the female or of the logo on a can of soda. He said Cindy Crawford in
slow motion is a goddess, within aesthetic appeal exceeding erotic, sure to transfix women as
well as men.
But the critical issue is, Will the ad have a positive effect on consumers? This question
is answer affirmatively by the last two sentences in Garfields column. Not accidentally, every
time you see this new logo you will conjure up Cindy Crawford. And that, I believe is
advertising.

Questions:
1. What was the managerial problem that Pepsi executives were attacking in developing the
Cindy Crawford Commercial?
The managerial problem that Pepsi executives were attacking in
developing the Cindy Crawford Commercial was the effect or the impact it can do to the
customers as well as to the product itself.

2. What consumer concepts from behavioral learning apply to the Pepsi commercial?
Explain.
The consumer concept from behavioral learning that applies to the Pepsi
commercial is the observational learning, also called vicarious or social learning. This
theory proposes that people develop patterns of behavior by modeling their behavior on
the actions of others, same with the ad, it uses model for the consumers to emulate or to
teach them entirely new behaviors.

3. Develop a managerial applications analysis that describes the effects of the commercial.
Specifically discuss/show how the consumer behavior concepts identified relate to
managerial strategy.

A Managerial Applications Analysis of the Cindy Crawford Commercial

Problem Identification
The managerial problem that Pepsi executives were attacking in
developing the Cindy Crawford Commercial was the effect or the impact it can do to the
customers as well as to the product itself.

The Consumer Behavior Analysis and Its Managerial Implications

The Pepsi Company introduces its new Pepsi can to the public, and uses model to
advertise it. That is Observational Learning, which is also called vicarious or social
learning that refers to the phenomenon whereby people develop patterns of behavior by
observing the actions of others. They choose Cindy Crawford to be its model because as

what Bob Garfield states in his column in the Advertising Age Magazine, Cindy
Crawford in slow motion is a goddess, with aesthetic appeal exceeding erotic, sure to
transfix women as well as men. She is physically attractive and can surely draw interests
from its consumers easily.
But the ad only gives off negative effect on the consumers. Its as if the main goal
of the ad is to seduce people or consumers rather than promoting the new Pepsi Can. The
ad is disgustingly horrible for the childrens viewing. Even the men, its as if they are
watching porno instead of an ad because its disturbingly ticking their sexual drive. As for
women, the possible message they are likely to receive is: Cindy Crawford is better than
you. She is better than everyone. She is a superior being. Cindy Crawford has it all. So
instead of consumer emulating Crawford, they will likely dismiss the idea of imitating
her and grabbing that new Pepsi can because of that negative notion the ad has.

Managerial Recommendations
Recommendation 1 The Company can use Cindy Crawford as a model for the
commercial as long as the scenes are harmless or not that sensuous for the viewers or
consumers specially the minors.
Recommendation 2 The Management can create another storyboard for the commercial.
Recommendation 3 Find another model for the commercial.
4. Discuss the ad in terms of the objectification of women. Do you think that womens
group should be upset by the advertisement?

In analyzing the ad Bob Garfield raised the question of whether it

objectifies women. His answer: yes and no. he said that the ad does objectify Crawford
in a wry and self-conscious way, toying with mens libidos at least partly to make light
to them. We think that the womens group should be upset by the advertisement because
it lowers the morale of every woman. The ad suggests lust for the men towards every
woman. Thats one of the reasons why some men do not respect women because they
only see them and treat them as an object and not as a human being with feelings. The
possible message women are likely to receive is: Cindy Crawford is better than you. She
is better than everyone. She is a superior being. Cindy Crawford has it all. So instead of
consumer emulating Crawford, they will likely dismiss the idea of imitating her and
grabbing that new Pepsi can because of that negative notion the ad has.