Teaching price sensitivity to teenagers in business studies lessons can be difficult, but one of my favourite activities concerns this very topic.
At the start of the lesson, students are asked to quickly note down their most recent purchases. Then, in pairs, they share and rank the items, putting those they would avoid or substitute for other items if the price went up at the bottom of the list. Items at the top of the list, which would still be purchased, are price insensitive.
The classroom is then transformed into Ludlam's Mocktail Bar. Each team of three students is given cups, straws and coloured juices: they have 20 minutes to make and market a product to sell to a neighbouring class. In my instructions, I tell them that they have to consider price, product appearance, promotion and where to place the mocktail in the classroom to attract the visiting consumers.
A frantic laboratory emerges as drinks are mixed and arguments over marketing and price rage. I usually give the class a five-minute warning before it is time for the judges to arrive. Your students should be banished while the consumers browse, as their presence may lead to unfair persuasion.
After looking at the goods on offer, the consumers give their verdicts by filling out pre-printed sheets. Usually, the winner is not the lowest priced drink but the most carefully and neatly promoted, and the most averagely priced. This is what you are aiming for.
Once the outrage and sense of injustice dies down, the class realises that when a market abounds in substitute goods, a median price and effective promotion tend to win the day.
Students love this task, even though it is hectic and sticky. Ultimately, they are able to relate the concepts of price sensitivity, insensitivity and substitute goods to luxury goods, fuel, low-priced value goods in supermarkets, and so on. As a result, the lesson is well worth the hassle. But remember to bring some wet wipes.
Belinda Ludlam is director of sixth-form learning at Oaklands Catholic School and Sixth Form College in Hampshire, England.