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2. Should Best Buy keep its permanent price-matching policy or abandon it in favour of
another approach?
Learning Objective
The case can be used to illustrate some of the major challenges facing national brands in
the consumer packaged goods industry including: The increasing strength of private label
brands and price sensitivity of consumers; Consumers shifting preference away from big
brands and toward small, values-based brands; The rise of direct-to-consumer brands sold
via e-commerce, digital marketing, and subscription models; Shifting demand from store-
based retailing to online retailing and the increasing encroachment of Amazon in the CPG
space; Pricing pressures from the dominance of discount retailing. Specific learning
objectives include: Assessing how big brands can fend off competition from small brands;
Understanding the importance of brands to consumers, how brands provide value, and why
brands matter; Evaluating the conditions under which consumers' loyalty to brands is strong
vs. weak and where national brands are vulnerable; Determining new strategies for national
brands to ensure their success in online retailing.
GROUP V - Predicting Consumer Tastes with Big Data at Gap
Assignment questions.
1. Why is Gap doing poorly in 2017?
2. Was Peck correct in firing his creative directors and replacing them with a big data-driven
creative process? Why or why not?
3. What do you predict will happen to Gap Inc.’s sales going forward as a result of this
decision? How will it affect each of its brands’ equity?
4. Does the big data approach work for all three of Gap Inc.’s primary brands: Old Navy, Gap
and Banana Republic? Why or why not? Which brands are better/worse served by this
strategy? Why?
5. Should Peck allow Gap Inc.’s brands to be sold on Amazon? Why or why not? What
opportunities does this plan present? If Gap sells through Amazon, should the company be a
wholesaler or a third party seller? Why?
6. What is your assessment of Product 3.0? How would you improve it?
7. Would you change other elements of the marketing mix to address Peck’s problems?
Which ones and how?
8. For which purpose is big data/ predictive analytics more or less useful in marketing? As
we move into a world filled with more data, what is the role of art versus science in
marketing? Under which conditions should “science” rule and under which conditions should
“art” rule?