Texas Instruments Background In 1982, Texas Instruments (TI) began to expand its product line beyond hand-held calculators to handheld learning aid products (LAPs) for the childrens market. Over the next decade, TI launched LAPs designed to teach children simple math problems (Little Professor), spelling (Speak & Spell), and shapes and sounds (Teddy Touch & Tell). By the mid-1990s, TI found increased competition in the LAP market. New competitors entered the hand-held LAP market, such as VTech who produced products such as the Little Smart Alphabet Desk (for learning the alphabet) and Small Talk (for learning shapes, and words). Substantial competition was also emerging from computer software companies, such as Broderbund and Learning Company, which became famous for educational software such as Reader Rabbit and Playroom for the childrens market. Further developments in the laptop and tablet market have added to competition in the LAP market. By 2010, prices for computer tablets had decreased to the point where they were viable to serve as learning aids for children.

Magic Reading Desk In 2010, TI introduced a new LAP called the Magic Reading Desk. The unit looked like a simplified laptop computer, with five large easy-to-use cursor keys and two round response buttons. Ten different learning games could be inserted into the LAP, all intended to develop pre-reading and reading skills in children aged 37. The Magic Reading Desk was more versatile than competing hand-held LAPs because different games could be inserted. It also provided an advantage over educational software reading products because a personal computer was not necessary for its use. Compared to tablets, the Magic Reading Desk was less complicated to use, more durable, and less costly (with a retail price of $31.99). TI sold the Magic Reading Desk to major retail stores and chains through the TI sales force.

Expanding Sales to the Educational Market TI management believes that it has an opportunity to expand sales of the Magic Reading Desk from consumer markets to educational institutions such as schools and daycare facilities. The Magic Reading Desk is very easy to use, durable, reliable, and needs only rechargeable batteries for its upkeep. TI could distribute the product through specialized audio-visual dealers that deal with educational markets, though their suggested margin of 30% off retail would require TI to sell the Magic Reading Desk at a higher price than regular retail markets in order to remain reasonably profitable. TI management is projecting a price of $49.99 for the educational market. A remaining issue is how the Magic Reading Desk should be branded for the educational market: 4a. One option is to use the same name, Magic Reading Desk, used in the consumer retail market. Packaging in the consumer retail market includes the brand Texas Instruments in small script across the top of the package; thus, the Texas Instrument name appears as an endorser. b. A second option is to use a new name for the product, such as Reading Tutor, and omit any reference to Texas Instruments as an endorser. c. A third option is to combine a new name, such as Reading Tutor, as a subbrand with the Texas Instrument namee.g., Texas Instrument Reading Tutor.

Questions 1. Consider the three branding options. Using your knowledge of brand architecture, how would you label each of these optionsbranded house, house of brands, subbrands, or endorsed brands? Explain why you areassigning these labels to each option (15 points) 2. Consider the three branding options for expanding sales into the educational market. Which branding option do you recommend for the educational marketand why? In your answer, be sure to evaluate the advantages and disadvantages of all three branding options for the educational market. (35 points)