Transcript
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Introduction
Situation Analysis
Agenda
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Solution
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Agenda Timeline
Risks and Assumptions
Wrap-Up
Daniel Marzec
● Sophomore● Computer Engineering
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Drew Pinkerton
● Sophomore● Supply Chain Management
Prajwal Chandrashekar
● Freshmen● Mechanical
Engineering
Josiah Mooney
● Sophomore● Needed a team
OUR TEAM
+ +Growing movement of environmentally friendly transportation
Sustainability Shift
Profitable last few years and government funding
Large BudgetIncreasing frustration with operational inefficiencies
Customer DissatisfactionMicro Cars have steady and dominating market share
High Car Usage
Intro Situation Complication Objectives Proposal Timeline Risks/Results
+
SITUATION
Restrictions-Government-Infrastructure-Pricing
Untapped CustomersLarge segments of customers are
untapped. Lack of focus on specific high-growth potential
segmentsReputationDelays cause dissatisfactionHigh customer expectationsLack of organizational unity
GrowthMust stimulate 7.5% increase in
passenger kilometers within 3 years
COMPLICATION
Intro Situation Complication Objectives Proposal Timeline Risks/Results
KEY OBJECTIVES
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Eliminate delays in information
Create a seamlessly integrated user experience
Increase annual travel distance by 7.5% in 3 years
Remain profitable Leverage $400
million budget Satisfy high
expectations
REPUTATIONPOLITICALECONOMIC
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Commerce Slides
RE-BRAND
INTEGRATE
RE-STRUCTURE
THE RIR SOLUTION
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Commerce Slides
RE-STRUCTURE
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Create new parking spots in each of the 200 least used stations
Parking
Pricing
RE-STRUCTURE
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Decrease prices for all non-peak hours
SafetyReassure customers about changes done to assure safety
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Commerce Slides Intro Situation Complication Objectives Proposal Timeline Risks/Results
RE-STRUCTURING STRATEGY 1: PARKING
Create at least 30 new parking spots in each of the 200 least used stations
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Motivated Non-User segment 702000 people
50% acquisition of segment in 10 years 351000 people
60 customers per spot 5850 spots
Stations with lowest traffic/most 200 stations
29.25 spots/station
Daily spendable parking tickets for customers.
RE-STRUCTURING STRATEGY 1: PARKING
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Commerce Slides Intro Situation Complication Objectives Proposal Timeline Risks/Results
RE-STRUCTURING STRATEGY 2: PRICING
Decrease prices for S-train for all times around the rush hours
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Continue removing the number of “products” offered
RE-STRUCTURING STRATEGY 2: PRICING
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Emergency Call Systems placed strategically throughout the stations
Immediate Customer Safety alerts sent through the app
RE-STRUCTURING STRATEGY 3: SAFETY
EXPENSES
REVENUE
20,000 Krone per parking lot
Conservative Emergency Call Box price estimate
$406,000 Projected Expenses in 2 Years (Appendix B)
NET EFFECT
FINANCIAL ANALYSIS
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Conservative New Customer Acqusition Estimate
$1,392,000 in Additional Revenue in 2 years (Appendix B)
New Customer Acquisition
$986,000 Projected Net Income in 2 Years
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Commerce Slides
INTEGRATE
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Multiple apps required
Inaccurate and late reports
Limited functionality
Overall lack of integration
Current State
Commerce Slides
Simple User Interface
DesignEasier Point of
Service with 24/7 Support
ServiceTrip planner and seat reservations
Plan
Store Frequent Routes and get updates on timing
Bus and Taxi service integration
Immediate safety alerts
Increased Mobile Payment Processing
Our Solution
Intro Situation Complication Objectives Proposal Timeline Risks/Results
Customer AcquisitionPlatform for growth
Passenger AnalyticsPredict and prepare for
customer needs
Data CollectionFeedback and optimization
Point of ServiceDirect link to customer
INTERNAL BENEFITS
Intro Situation Complication Objectives Proposal Timeline Risks/Results
EXPENSES $540,000 Initial Investment (Appendix A)
REVENUE $792,000 Projected Revenue in 3 Years (Appendix A)
NET EFFECT
FINANCIAL OUTCOME
Intro Situation Complication Objectives Proposal Timeline Risks/Results
$252,000 Projected Net Income (Appendix A)
Seamless consumer experience
2,000 added customers per month
RE-BRAND
Intro Situation Complication Objectives Proposal Timeline Risks/Results
RE-BRAND
Current State of DSB’s Brand
Slow and Delayed
Subpar Customer Service
Outdated and Expensive
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Commerce Slides
1 New Logo
Incentive Programs2
3
RE-BRANDING PLAN
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Advertising Campaign
Unmotivated Heavy
Motivated Light Motivated Non-User
Motivated Medium
● Digital Savvy
● Live in Capital Region
● Find travel stressful
● Women and Singles
● Environmentally aware
● Capital region and Aarhus
● Elder and Married
● Capital region and large cities
● High income
● Rural demographic
● 2+ km away from train stations
● Take car or bus
TARGET MARKET SEGMENTS
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1 New Logo
Referral Program
Loyalty Program
● 5 km per referral (around 20% of average trip: Appendix C)
● Gain market share through continuous referrals
● Integrated through mobile app
● Discounted pricing for travel times around rush hour
● 5% of kilometers travelled awarded back
● Integrated through app
● Retain customers through incentives
2 Incentive Programs
Advertisements
Television
• Advertisements focused on new station features, app and +time
• Market: All targeted
Social Media
• Facebook, Instagram and Twitter ads with direct link to app and info on sustainability
• Market: Unmotivated heavy and Motivated medium
Billboards
• Billboards with a focus on +time and sustainability around less populated areas
• Market: Motivated non-users
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Commerce Slides
Potential Market Growth
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Bull• 4% market growth in one Year• Approximately 2,475,000,000 km (Appendix C)
Conservative• 3% market growth• Approximately 1,855,000,000 km (Appendix C)
Bear• 2% market growth• Approximately 1,240,000,000 km (Appendix C)
Total Expense: 16,600,000 Krone or 2,400,000 USD (.05% of annual budget)
Task Year 1
Year 2
Year 3
Unveil Logo
Marketing Launch Plan
App Development
App Launch
App Support
Construct New Parking
Safety Construction
Adjust Pricing
30IMPLEMENTATION TIMELINE
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Commerce Slides
● Performance of marketing campaign depends on many factors
● Limited time to change brand-image
● Innovations in sustainable transport
● Customer retention
● East-West construction will cause periodic delays for 3 years
Low Medium High
Intro Situation Complication Objectives Proposal Timeline Risks/Results
RISKS
IMPACT
Economic Political Reputational• Expanded customer base• App as alternate revenue
stream• Meeting high demand
• DSB serves as backbone of Denmark’s transportation
• Political expectation for growth satisfied
• Seamlessly integrated user experience
• Delays, traffic info, security• Communicating change to
the consumer
Intro Situation Complication Objectives Proposal Timeline Risks/Results
QUESTIONS
Appendix A: IT Development Financials● $500,000 for frontend and backend development
○ As seen in instagram and ubers development (source: https://savvyapps.com/blog/how-much-does-app-cost-massive-review-pricing-budget-considerations)
● $20,000 to restructure train & rail system GPS infrastructure○ Source: http://www.gps.gov/applications/rail/
● 0.05% per transaction ~ $20,000 set-up○ Source: https://paylinedata.com/pricing/
● $20,000 ad revenue per month○ 160million monthly users * 50% ○ Source: http://ryanmorel.com/mobile-advertising-calculator/
● New customer acquisition rate estimate = .005%○ Population with smart phones = .73(total population) = 4.03mil○ ~$2,000 in ad revenue calculated from○ Source: http://ryanmorel.com/mobile-advertising-calculator/
Appendix B: Re-Structuring Financials● 2,800,000 in Expenses
○ Parking spots = (200 stations)*(10,000 Krone per parking lot) = 2,000,000 Krone○ ECB= (400 stations)*(2,000 Krone per station) = 800,000
● Ticket Prices○ http://www.fyidenmark.com/ticketprices.html
● 9,600,000 Krone in Revenue○ Revenue = (2,000 customers per month)*(48 months per 2 years)*(100 Krone per
ticket)= 9,600,000 Krone
● Conservative monthly new customer acquisition rate estimate = .05%○ Population with cars= .70(total population) = 3.92mil*.0005= 1,996 potential
customers
Appendix C: Branding FinancialsKilometers travelled through DSB: 6,246,000,000 (10.1% market share)
Total Kilometers travelled in Denmark: Approx. 62,000,000,000 passenger km4% market share: 62,000,000,000 * .04 = 2,475,000,000 passenger km3% market share: 62,000,000,000 * .03 = 1,855,000,000 passenger km2% market share: 62,000,000,000 * .02 = 1,240,000,000 passenger km
Expenses(1 year)2 ads a day on primetime: 6,800,000 Krone4 ads non-primetime: 6,800,000 KroneMake 6,000,000 impressions with 250,000 downloads: 2,000,000 Krone40 billboards in rural areas: 1,000,000 kroneTotal: 16,600,000 krone
Average trip length: Passenger kilometer / Total trips taken(domestic + abroad)6,246,000,000 / (191,881,000 + 9,185,000) = 31.1 km6 km / 31.1 km = .19%
Appendix: Value Index
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