Transcript
CLEAN EDGE RAZOR:SPLITTING HAIRS IN PRODUCT POSITIONING
GROUP 14
THE GENERAL FRAMEWORK OF OUR BUSINESS CASE
DETERMINING PROBLEMS:1.WE HAVE 2 SCENARIOS:MAINSTREAM
POSITIONING & NICHE POSITIONING2.CHOOSE THE MOST RELEVANT BRAND
NAME3.PREDICT BUDGET ALLOCATION & PRIVATE
MARKET SHARE
ELIMINATION OF THE 2ND SCENARIO
LET’S COMPARE FINANCIAL FORECASTS OF 2 SCENARIOS BASED ON EXHIBIT 7
MAINSTREAM NICHE
YEAR 1 YEAR 2
YEAR 1 YEAR 2
SUGGESTED PRICE
123 242 53 130
MANUFACTURED PRICE
84 164 37 79
PRODUCT COST
35 64 13 25
GROSS PROFIT
7 61 9 38
OVERALL GROSS PROFIT
44 98 69 101
COMPARE THE SUGGESTED PRICE (IN MAINSTREAM POSITIONING) WITH COMPETITORS
SDS
IN YEAR 1 OVERALL GROSS PROFIT FOR NICHE POSTIONING IS MUCH MORE THAN MAINSTREAM POSITIONING (69>44)
IN YEAR 2 THERE IS A LITTLE DIFFERENCE AMONG INDICATORS
THE CONS OF MAINSTREAM POSITIONING
1. THE CANNIBALIZATION OF EXISTING PRODUCTS IS VERY HIGH(60%)
2. THE COST FOR MARKET PROMOTION IS VERY HIGH($ 42 MLN)
3. THERE IS NOT CONCRET TARGET SEGMENT, SO IT IS VERY HARD TO MEET , ANALYSE, DETERMINE THEIR PREFERENCES,AND TO FIND OUT THE MOST RELEVANT BRAND NAME)
RESULT: WE PREFERED “NICHE RESULT: WE PREFERED “NICHE POSITIONING”POSITIONING”
LET’S BEGIN TO CONSTRUCT STRATEGY FOR NICHE POSITIONING
TARGETING THE MOST APPROPRIATE SEGMENTS
WE CHOSE 2 SEGMENTS: SOCIAL-EMOTIONAL &AESTHETIC SHAVERS—OUR TARGETED SEGMENT IS 67%
OUR COMPETITORS AND PREDICTED PRIVATE SHARE IN THE MARKET
Market leader since 1950s, 224 mln $ revenue, 45 mln $ operating profit
Brend: Vitric, 23,2 % of market share
Brend: Naiv, 2,6 % of market share
Brend: Tempest5,7 % of market share
23 % of market share
PRIVATE SHARES FOR YEAR1 & YEAR2(WITH $(%))
BREND CONSTRUCTION BREND POSITIONING
THE FOLLOWINGS HAVE TO BE TAKEN INTO ACCOUNT IN CHOOSING BREND NAME
WE HAVE 3 ALTERNATIVES OF THE BREND NAME
ADVERTISING & PROMOTIONYEAR 1:
SOME BASIC HIGHLIGHTS ABOUT A&PROMOTIONS
• IF THERE WILL BE 35% CANNIBALIZATION IN SALES , WE HAVE TO TAKE INTO ACCOUNT THIS IN A&P , SO
$48,3 MLN*35% / 100%=$ 17 MLN
IT MEANS THAT WE CAN ALLOCATE THIS AMOUNT OF MONEY FOR THE NEW PRODUCT & IN Y1 AND Y2 WE NEED $15 MLN,$16 MLN FOR A&P PROPORTIONALLY===== $2 MLN & $1 MLN SURPLUS
A&P EXPENDITURES FOR PARAMOUNT ULTRA ҉ THIN 5
IT CAN BE MUCH MORE BENEFICIAL TO SPEND HALF OF THE MONEY ON MEDIA, AND SUBSTRACT THE REST HALF-HALF FOR CONSUMER PROMOTION AND TRADE PROMOTION
THANKS FOR ATTENTION!!!!
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