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Paddy Power Case: Foundations of Marketing

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Case 7: Paddy Power.
You answer the questions as follows: A. You state the central problem of the case in the introduction
How did Paddy Power build up its network of loyal customers? B. You mention the methods, models and concepts from the chapters in the book that you considered to use (you do not have to explain them, your tutor understands…)
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C. You explain which method, model or concept you decided to use and why
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D. You answer the questions. Include an argumentation based on the chosen method, model or concept and the information in the case.

1. Analyse the ways in which advances in technology have changed the betting business. What are the implications for betting firms?
Poker became more popular so they decided to come up with an online poker play. They are an entertainment company, at least that’s what they like to be seen as. Internet makes it available to communicate much easier with their clients.
2. How did Paddy Power go about building its service brand? * They have build different websites for different target groups. * They would like to be seen as fair, that’s why customers can get their money back in some situations. This makes the risk of betting a bit lower for the people who are involved. * They support charity organizations, for example with their strip poker contest. They have deals with other companies. * They don’t only focus on the high value customers, but on every customer. * They are seen as an entertainment company. * They have an abstract brand name, it’s not immediately linked to gambling. * It is globally available, very innovative and creative. * They have established themselves with a lot of advertising and were/are very well-known in the betting world.
3. Evaluate the services marketing mix used by Paddy Power. What are its strengths and weaknesses?
Strengths:
* Paddy Power is everywhere available. * The gambling doesn’t have to be expensive. There are bets for every amount of money. * They are training their staff for a giving a friendly service * They use really effective advertising, which leads to immediately recognizing of the brand. * They have a wide range of products * They have a loyalty programme, which sounds appealing to customers, * Their fairness, you will get your money back in some situations. * They adapt to changes rapidly. * They match their product with the changing customer.
Weaknesses:
* The advertisements are controversial and could become a weakness * It is still gambling so could be seen as unethical issue * They can be copied or imitated really easily.
4. Analyse Paddy Power’s customer relationship development initiatives. How successful have they been?
The meaning of customer relationship is: how you deal with your customers. How you keep them friendly and keep them in your business.
Paddy Power has a VIP programme, you get special points if you bet a lot and you can use them on their websites. They also claim that they are fair, which is high valued by customers. They have introduced their online services for specific target groups. All of these things lead to the the fact that the customers feel valued by Paddy Power.
5. Due to concerns from some quarters about the social impact of gambling, advertising is strictly controlled in the UK and Ireland. Paddy Power has circumvented this with some irreverent advertising campaigns and activities that subsequently caused offence to some groups and fell foul of the Advertising Standards Authority. What is your view of the tactics used by Paddy Power ? Are there ethical issues to be considered?
I think Paddy Power’s tactics work very good because they attract a lot of new customers by their way of advertising. However, I don’t think it is ethical to use some ethical/cultural/age groups in their commercials, because some people might feel offended while watching it. And if they feel really offended, they can try to sue Paddy Power and this will attract a lot of negative publicity. So my opinion is: Paddy Power should remain making controversial commercials, but without offending people.

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