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• Case | HBS Case Collection | September 2020 (Revised September 2020)

  Hot Wheels at Mattel: Reinventing the Wheel

  Elie Ofek, Andres Terech and Nicole Tempest Keller

  In 2017, Chris Down, Global Brand General Manager for Hot Wheels, and his team from the Advanced Play Group within Mattel, Inc., were considering which innovation path to pursue in order to "future proof" the Hot Wheels franchise going forward. Hot Wheels was the number one selling toy in the world (by unit volume), however, play patterns among children were rapidly changing and children were moving on from physical toys to digital play at a younger and younger age. Hot Wheels needed to determine how to respond. One option considered was the development of a new “mixed-play” product that blended physical and digital play. While the mixed play idea was still at an early conceptual stage, it would likely involve embedding a chip into the Hot Wheels die-cast car, turning it into a “smart car” with its own unique identification. Users could play with the smart car in the physical world and on an app, thus offering an opportunity to also appeal to Hot Wheels consumers who were intrigued by digital play. Hot Wheels had made a number of forays into the digital space over the years, through licensing the brand to app and game developers and developing toys with some digital elements. The licensing strategy was low risk, low reward, and Mattel’s own digital development had produced varied results, creating a culture hesitant to take big risks in the digital space. Down knew that a mixed play innovation would require a significant investment in time and resources. However, Hot Wheels parent company, Mattel Inc. had seen revenues and operating income drop for the past three years. It was unclear if Mattel’s new CEO, Margo Georgiadis, would be supportive of the mixed play direction as the cornerstone of Hot Wheels’ growth plan. With Hot Wheels’ 50th anniversary coming up in 2018, Down had to decide whether his team should push for an out-of-the-norm investment in this new mixed play idea or should Hot Wheels focus its time and resources on physical toys, developing a special collection of die-cast cars for the 50th anniversary? Alternatively, should Hot Wheels meet the age compression challenge head on by considerably expanding its pure digital initiatives?

  Citation:

  Ofek, Elie, Andres Terech, and Nicole Tempest Keller. "Hot Wheels at Mattel: Reinventing the Wheel." Harvard Business School Case 521-015, September 2020. (Revised September 2020.)  View Details

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• Case | HBS Case Collection | July 2020 (Revised August 2020)

  Pricing at Netflix

  Elie Ofek, Marco Bertini, Oded Koenigsberg and Amy Klopfenstein

  Since its launch in 1998 as “the Amazon.com of DVDs,” Netflix had evolved from a DVD rental company to a video streaming platform and producer of original films and television shows. As the company matured, it regularly increased prices and adjusted its product offerings while continuing to add new subscribers. However, between late 2019 and mid-2020, competition within the streaming industry intensified with the launch of new entrants such as Disney+, Apple TV+, and HBO Max, jeopardizing Netflix’s position as the industry leader. In spite of the heightened competition in the streaming industry, some analysts and customer willingness-to-pay surveys suggested that Netflix had the opportunity to implement another rate hike in the near future. By May 2020, Netflix must decide whether to increase prices again, or whether it should consider a different pricing model altogether.

  Keywords: pricing; Marketing; Marketing Strategy; Entertainment; Film Entertainment; Television Entertainment; Finance; Price; Strategy; Competition; Competitive Strategy; Business Strategy; Adaptation; Technology; Internet; Online Technology; Technology Platform; Customers; Customer Satisfaction; Customer Value and Value Chain; Entertainment and Recreation Industry; North and Central America; United States;

  Citation:

  Ofek, Elie, Marco Bertini, Oded Koenigsberg, and Amy Klopfenstein. "Pricing at Netflix." Harvard Business School Case 521-004, July 2020. (Revised August 2020.)  View Details

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• Case | HBS Case Collection | July 2020

  Pattern Brands

  Sunil Gupta, Elie Ofek and Julia Kelley

  In March 2020, direct-to-consumer (DTC) company Pattern Brands needed to decide how to allocate resources across its different brands. Pattern Co-Founders Nick Ling and Emmett Shine hoped to avoid the pitfalls faced by some DTC companies—such as inability to scale and lack of competitive differentiation—by relying on their previous experience running a successful branding and marketing agency. Rather than focusing on a single brand, they conceived Pattern as a “DTC 2.0” model—a portfolio of 5 to 10 brands that shared a common theme of activities related to the home and a common mission of helping millennials enjoy daily life. Since its founding in August 2019, Pattern had launched cookware brand Equal Parts and home organization brand Open Spaces. Although Pattern’s team still believed strongly in the benefits of a multi-brand strategy, Open Spaces’ sales and unit economics had significantly outperformed Equal Parts’ to date. Pattern’s leadership wanted to build on Open Spaces’ early momentum with new product colors and product lines, but they debated whether to act on the results of a recent customer survey indicating a positive response to an Equal Parts product redesign. Ling and Shine now had several decisions to consider. How should they allocate resources between repositioning Equal Parts and continuing to grow Open Spaces? How and when should they continue building Pattern’s portfolio by developing a third brand? How much should they invest in marketing parent brand Pattern? More broadly, did Pattern’s model represent the future of DTC brands?

  Keywords: direct-to-consumer; Brands and Branding; Marketing Channels; Marketing Strategy; Product Marketing; Product Launch; Product Positioning; Business Model; Business Startups; Growth and Development Strategy; Demand and Consumers; Business Strategy; Diversification; Competitive Advantage; Consumer Products Industry; Retail Industry; North and Central America; United States; New York (city, NY); New York (state, US);

  Citation:

  Gupta, Sunil, Elie Ofek, and Julia Kelley. "Pattern Brands." Harvard Business School Case 521-009, July 2020.  View Details

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