strategic marketing plan_company 8_le-viegas-pearson-clubb

MARKETING PLAN COMPANY 8

PRODUCT 1 SPECIALIST S: GABRIEL VIEGAS & ANH LE

PRODUCT 2 SPECIALIST S: JOSHUA CLUBB & BLAKE PEARSON

PREPARED FOR

DAWN ROVERS

MARCH 25, 2013

Company 8 Marketing Plan 2015

Table of Contents Executive Summary ..........................................................................................................................................................................4

Company Situation Analysis .............................................................................................................................................................5

Company Description ...................................................................................................................................................................5

Market Summary ..........................................................................................................................................................................7

Product 1 ..........................................................................................................................................................................................9

Product 1 Environmental Scan .....................................................................................................................................................9

PEST: .........................................................................................................................................................................................9

Competitive Analysis ............................................................................................................................................................. 10

SWOT ..................................................................................................................................................................................... 12

Key Differentiator .................................................................................................................................................................. 12

Product 1 Marketing Strategy ................................................................................................................................................... 13

Marketing Objectives ............................................................................................................................................................ 13

Financial Objectives ............................................................................................................................................................... 14

Target Markets ...................................................................................................................................................................... 14

Marketing Mix ....................................................................................................................................................................... 15

Product 1 Appendices ............................................................................................................................................................ 18

Product 2 ....................................................................................................................................................................................... 28

Product 2 Environmental Scan .................................................................................................................................................. 28

PEST ....................................................................................................................................................................................... 28

Competitive Analysis ............................................................................................................................................................. 29

SWOT ..................................................................................................................................................................................... 31

Key Differentiator .................................................................................................................................................................. 31

Product 2 Marketing Strategy ................................................................................................................................................... 32

Marketing Objectives ............................................................................................................................................................ 32

Financial Objectives ............................................................................................................................................................... 33

Target Markets ...................................................................................................................................................................... 34

Marketing Mix ....................................................................................................................................................................... 35

Product 2 Appendices: ........................................................................................................................................................... 38

Conclusion ..................................................................................................................................................................................... 49


Overall Financial Analysis .......................................................................................................................................................... 49

Statement of Direction .............................................................................................................................................................. 50

Company Specific Appendices ....................................................................................................................................................... 51


Executive Summary

Mission Statement: To provide premium quality products to our consumers. Our products are reliable and we carry a well-

known brand.

Our company has been established as one of the most profitable companies in Mavlandia. Driven by our net profit and sales

efficiency, our company finished in first place overall ath the end of Quarter 4. This report will provide information of Key

Strengths, Weaknesses detailing how our products are doing in their respective markets. It will provide a detailed summary of

PEST, Competitive Analysis, SWOT and Key Differentiator for an Environmental Scan. As well Marketing Objectives, Financial

Objectives, Target Markets, Marketing Mix and added Appendices for each Product in our Marketing Strategy. Our report will

provide detailed information of what decisions will be made in the next quarter. Product 1 will go through heavy transition of

its advertising and decreasing costs in that section. We will also take a different approach to marketing this product and will

base it on features and quality, to give it a competitive advantage over our competitors; this will help us succeed in the future

quarters for this product. Product 2 will continue to keep its consistent positioning as a premium product and not many

decisions need to be made. This product will continue to support a quality based premium product.

We will continue to keep costs low of Product 1 and try to differentiate our Product 1 from its competitors. Our key strengths

for Product 1 are high profit margin and low cost per product. Our Product 1 has struggled in gaining market share compared

to the competitors, therfore this is an area our company needs to improve. We will utilize a Pull/push strategy with an

emphasis on pull for Product 1. Product 2 will focus heavily on being a premium priced product with a high degree of quality in

all 3 regions. Product 2 is extremely profitable and is doing really well amongst the companies in the 3 regions. Product 2 has a

high net income, second largest market share in Region 1, third largest in Region 2 and largest in Region 3. Product 2 has also

the second largest social media following and a consistent ad message. Product 2 sells well, and has a very large net income.

Our main focus for Product 2 is utilizing a Push/Pull Strategy with an emphasis on push.


Company Situation Analysis

Company Description

Company 8 finished Quarter 4 in second place, with $299,542.00 in profit, and is first overall after 4 quarters (Refer to Figure

22 – Overall Company Financials Q1-4 and Q5 Projection). Product 2 is utilizing a push/pull strategy with an emphasis on push.

We are focusing on product quality with heavy sales promotion and trade publication. Product 2 has been successful in

achieving the market share with high rate of sales growth and high return on sales. On the opposite side, Product 1 is having

trouble with maintaining the net profit and market shares. This will need to improve in order for our company to stay in first

place.

Figure 1: Q4 Marketing Mix Strategies and Tactics for Product 1

Marketing Mix Region 1 Region 2 Region 3

Product Strategy Differentiated Differentiated Differentiated

Summary of Product

Tactics Features: 2 Quality: $1.00

Features: 2 Quality: $1.00


Pricing Strategy Premium Pricing Premium Pricing Competitive Pricing

Summary of Pricing

Tactics

Price = $19.99 Process imp = 0



Promotions Strategy Push/Pull – larger emphasis on Pull

Push/Pull – larger emphasis on Pull

Push/Pull – larger emphasis on Pull

Summary of

Promotions Tactics

Sales promo = $35,000 CM = 12 TM = 10 AD MSG = Features SM = $10,000 SEO = $10,000

Sales promo = $18,000 CM = 8 TM = 5 AD MSG = Features SM = $10,000 SEO = $10,000

Sales promo = $40,000 CM = 17 TM = 12 AD MSG = Price SM = $10,000 SEO = $10,000

Place Strategy Medium Low Low

Summary of Place

Tactics SF= 3 Com%= 3%

SF= 2 Com%= 3%

SF= 3 Com%= 3%

In Quarter 4, the ad message for Product 1 was changed to features in Regions 1 and 2, instead of focusing on price and

benefits. The price strategy remained the same for all three regions with a price of $19.99 in Regions 1 and 2, and $17.97 in

Region 3. Due to the high price of Company 8’s Product 1 when compared to the others companies, Company 8 is

experiencing low sales revenue and a shrinking market share. With too much spending on advertising and promotion, Product

1 has also incurred high operating and inventory carrying cost. As a result, Product 1 failed to break even in Quarters 2-4.


Figure 2: Q4 Marketing Mix Strategies and Tactics for Product 2

Marketing Mix Region 1 Region 2 Region 3

Product Strategy

Differentiated based on Quality



- Summary of Product Tactics




Pricing Strategy

Premium Pricing Premium Pricing Premium Pricing

- Summary of Pricing Tactics

Price = $84.00 Process imp = $0



Promotions Strategy

Push/Pull – larger emphasis on Push



- Summary of Promotions Tactics

Sales promo = $45,000 CM = 15 TM = 22 AD MSG = Quality SM = $20,000 SEO = $20,000



Place Strategy

Medium Medium Medium

- Summary of Place Tactics

SF= 6 Com%= 5.00%

SF= 4 Com%= 5.00%

SF= 5 Com%= 5.00%

With a consistent advertising and promotion strategy, and carefully controlled costs, Product 2 has experienced major growth

in terms of sales and market share in each region, resulting in an industry leading net income. This success has been a major

force in driving Company 8 to the first overall position. The prices were slightly increased in quarter 2 to $84.00 in Region 1

and 2, and decreased to $75.00 in Region 3 in response to market demand in each region. Product 2 also utilizes a push/pull

strategy with an emphasis on push, and has a large following on social media.

Discussion & Conclusions:

Total sales for Company 8 increased from Quarter 1 to Quarter 4 with a slight decrease in growth in Quarter 3 due to

stagnating market growth, increasing inventory carry cost for Product 1, and low inventory levels for Product 2. In Quarter 1,

the majority of net income and sales came from Product 1. Despite its initial success, Product 1 experienced negative growth

in Quarters 1-4 due to high inventory carry costs and failed to break even in Quarters 2-4. Due to Product 1’s struggles, all of

the net income for Company 8 in Quarters 2-4 was generated by Product 2.


Market Summary

Region 3, which has 40% of the population, has been the most important region for Product 1. These individuals are bargain

hunters and resistant to new ideas, they look for a reasonably priced brand that delivers a consistent message. Region 2,

which holds 20% of the population, has responded well to Product 2 because consumers are upscale, wealthy, and open to

new ideas. Region 1 has 40% of the population that’s wealthy and open to new ideas. Product 2 does extremely well in this

region. The market for Product 2 has grown in each quarter; however growth does appear to be slowing (Refer to Appendix

35).

Figure 3: Segmentation Analysis

Region Segmentation Criteria Description Market Attractiveness (High, Medium, Low)

Product 1 Product 2 Region 1 40% of the

population

Wealthy and upscale

Open to new ideas

Relative affluent

Product 1:

Responds well to low price

Push/pull strategy with an emphasis on pull is effective

High sales promotion spending has proven effective

High level of social media involvement

Prefers features (Refer to Appendix 7)

Product 2:

Responds well to high quality

Push/pull strategy with an emphasis on push is effective


Willing to pay a high price

High level of social media involvement (Refer to Appendix 22

Medium High (2nd priority)

Region 2 20% of the population

Wealthy and upscale

Open to new ideas

Relative affluent

Product 1:


High sales promotion spending has proven ineffective


Responds well to features (Refer to Appendix 8)

Product 2:

Responds well to high quality


Willing to pay a high price

High level of social media involvement (Refer to Appendix 23)

Low High (3rd priority)


Region 3 40% of the population

Resistant to new ideas

Less affluent

Bargain hunters

Product 1:

Responds well to an ad message of price


High sales promotion spending has proven effective (Refer to Appendix 9)

Product 2:

Responds to high quality, however they are unwilling to pay a high price




Responds well to low price

Responds well to features (Refer to Appendix 24)

High High (1st priority)

To conclude, Product 1 has performed best in Region 3 as sales in that region far exceed sales in Region 1 and Region 2.

Product 1 consumers have shown that they respond well to low price in Region 1, which is surprising given the affluence of

that region. In Region 2, companies that have spent a large amount of money on sales promotion have seen limited returns,

however companies with a large social media following have done well (Refer to Appendix 8). In Region 3, Product 1

consumers have responded well to an ad message of quality, and sales promotion spending has proven to be very effective.

Product 2 has grown steadily since its introduction in Quarter 0. In Region 1, consumers have demonstrated that they are

willing to pay a high price for a product with a sufficient degree of quality. They have also shown a preference towards

companies whose Product 2 offers a number of features (Refer to Appendix 22). In Region 2, consumers mirror their

neighbors in Region 1 in that they too have shown that they are willing to pay a high price for a high quality product, and that

they like products that have a lot of features (Refer to Appendix 33). Region 3 has been a controversial region, where buyers

like products that have a high degree of product quality; however they are hesitant to pay a high price. Sale promotion has

proven to be very effective in Region 3, and the consumers in this region also respond well to features (Refer to Appendix 24).

All 3 regions have shown a correlation between sales and the size of a company’s social media following (Refer to Appendix

22-24).


Product 1

Product 1 Environmental Scan

PEST:

After 4 quarters of operating, the market has changed slightly in the demands based on the changes of customers’ needs,

politics, social, and technologies. PEST analysis will provide Company with more information about those changes and how it

might affect the company and its operation, as well as predicting threats or opportunities Co. 8 potentially will have to face.

Figure 4: PEST Product 1

PEST Analysis

Trends identified from Industry Changes announced by Chairman of the Board

Possible Impact in each region

Political Government of Canada reduce the rate of short-term loans

Increase of net profit because of decreasing in interest expense

Tax increase on major components of Product 2

No impact

Economic Auto industry continues to shrink. Shutdown of Ford & Chrysler causes 200 jobs lost in region 3

Loss of sales to in region 3

Opportunity to reduce commission rate of sales force due to lack of unemployment rate increases

Social Society is becoming tech savvy, increase in product of product 2

No impact

Technological Production efficiency caused production of product decrease

Decrease in production cost of Product 1

Increase in net profit margin

Opportunity to invest in features

There are 3 out of 5 changes analyzed in PEST analysis will have impact to Product 1 and its sales revenue: Decreasing of

short-term interest rate, auto industry shrinks, and reducing cost of production for Product 1. These changes will create a

potential opportunity for Product 1 to increase its net profit margin, to cut off cost of operating, and to invest in features or

focus on quality of product.

As cost of production is dropped down, we predict that prices of P1 in region 3 of other companies will decrease, and more

investments in features and/or quality potentially will increase. On the other hand, prices of P1 in region 2 and 3 could be

dropped down if there is no investment is made for P1. Co.8 is planning to invest money on features in order to compete with

our main competitor Co.7 and Co.4.


Competitive Analysis

Competitive analysis provides information about Co.8’s main competitors with the most competitive prices, features, and

marketing strategy. The top 3 competitors are picked based on perceptual maps and market research report provided with

unit sold, prices, etc… Those competitors have the similar position in the perceptual map compare to Co.8, but higher unit

sold for each region. This analysis will help our company to understand our competitors better about how they have been

promoting their products, which factors are helping them to attract customers, and how well they’ve been doing with that

marketing strategy. Therefore, Co.8 would be able to predict the changes of our competitors and what we should do in order

to emulate with the competition and increase the net profit.

Figure 5 Quarter 4 - Top Competitors Product 1 Region 1

Team Product Strategy Price Strategy Promo Strategy

Place Strategy

Market Share

Threat Level

Your Co. 8 Differentiated Premium Pull/Push with

emphasis on Pull Medium 6.37% N/A

First 7 Niche Premium Pull/Push with

emphasis on Pull Medium 11.29% High

Second 4 Undifferentiated Premium Pull/Push with


Third 3 Undifferentiated Value-based Push/Pull with emphasis on

Push

High 9.40% High

Co.7 has the highest market share compare to other companies (2nd position in the industry) and they are using premium

pricing strategy but focusing on developing more features to adapt customers’ needs. Co.4 has the same focuses on investing

on features (currently has less features then Co.7) combines with premium pricing strategy. On the other way, Co.3 focuses on

quality instead of features with the value-based pricing strategy helps them to have the 4th highest market share in the

industry. Co.4 and Co.3 using undifferentiated strategy to maintain their messages delivered to customers about their

products which are focusing on features and quality.

After all, these 3 competitors have high prices with the main focus on either features or quality, combine with pull/push

strategy are having high market shares compare to other companies. In order to compete with these company while maintain

the pricing strategy to remain the profit margin level; Co.8 needs to either invest on features or quality.




Place Strategy

Market Share

Threat Level

Your Co. 8 Differentiated Premium Pricing Pull/Push with

emphasis on Pull Low 6.18% N/A

First 9 Differentiated Competitive

Pricing Pull/Push with


Second 4 Undifferentiated Premium Pricing Pull/Push with

emphasis on Pull Low 10.37% High

Third 3 Differentiated Premium Pricing Push/Pull with

emphasis on Push Medium 9.00% High

Company 9, 4 and 3 is imposing a high threat level to company 8. Company 9 has a 9.20% market share, company 3 a 9%

market share and our number one competitor company 4 at 10.37%. All 4 companies use pull as their promotion strategy and

intensive distribution as their place strategy. Company 3,4 are using premium pricing to market their product in region 1 and

company 9 is using comparative while company 8 is using odd pricing. Company 8 must implement features to its product to

differentiate itself from the competitors especially region 2. Market share for company 8 is low compared to its competitors

and features must be implemented. Product 8 needs to develop a product that differs from the market to increase its market

share going forth in the further quarters. Company 8,9and 3 all have a differentiate product strategy while company 4 utilizes

features as its ad message which is the same as company 8’s.



Place Strategy

Market Share

Threat Level

Your Co. 8 Differentiated Competitive Pricing Pull/Push with

emphasis on Pull Low 8.66% N/A

First 7 Differentiated Premium Pricing Pull/Push with


Second 4 Undifferentiated Premium Pricing Pull/Push with


Third 9 Differentiated Comparative

Pricing Pull/Push with

emphasis on Pull Medium 6.80% Medium

Co. 7, 4 and 9 are our top competitors. Company 7 has the highest market share of 11.82% and they are our highest

competitor with the highest threat level. Company 4 then 9 follows which follow closely behind in market share. All 4

companies use a promotional strategy of “Pull” heavy advertising and sales promotion is spent to pull in our consumer

to purchase more products. Company 8 focuses more on the pricing aspect while Company 7 our biggest competitor

focuses on features. The other two companies 4, 9 focus on pricing. Company 8 should incorporate more features to

compete with company 7 in develop a better outstanding product to sell to the consumer. Company 8 focuses on

premium pricing as well as 7 and 9 while company 4’s focus is on premium pricing. Company 8 in the following future

quarters needs to improve and collectively produce a better product with an increase in features to better compete with

the others.


SWOT

SWOT (Strengths, Weaknesses, Opportunities and Threats) will provide our product of what needs to be focused on most and

what needs the most work. It will help our company become more profitable and organized about the direction of what we

want to proceed in managing our product. Based off SWOT our company can decide how to market the product and what

different affects are taking place in the industry that will affect sales as well as consumer behavior. We can analyze external

and internal infrastructure of the environment our product is in and base it on increasing sales, net profit and sales efficiency.

Figure 8 – SWOT Analysis

SWOT ANALYSIS – PRODUCT 1 Strengths: 1. High Profit Margin (See appendixes 10, 11, 12) 2. Low Cost Product due to other companies invest high amount of money on features and quality(See appendixes 10, 11, 12)

Weaknesses: 1. Decreased Sales (See appendixes 13, 14, 15) 2. High Carrying Cost (See appendixes 13, 14, 15) 3. High Cost of Operation (See appendixes 10, 11, 12) 4. Low Sales Efficiency (See appendixes 13, 14, 15)

Opportunities: 1. Decrease of cost production for Product 1 2. Government Reduces Interest Rate of Short Term Loan 3. Lower commission rate for sales force due to 200 job losses 4. Higher profit margins due to cost of production decrease in return higher net profit

Threats: 1. Industry Shrink in Region 3 2. Decline stage in life cycle (PLC) 3. Lower prices from competitors due to product cost decrease (See appendixes 4, 5, 6) 4. Potential drop in sales due to job losses 5. Co.7 would be the main threat for our company because of similar product and pricing strategy (See appendixes 4, 5, 6)

What conclusions do you draw? The conclusion we drew from using the SWOT analysis was our product is a low cost brand with a high profit margin with premium pricing. This allows our company to be profitable in sales and attract the consumer to purchase more from our company. Although we suffer from having too much inventory which is subject to high carrying costs as well as high spending in advertising and promotion which leads to drop in net profit. Our company also suffers from high cost of operation and low sales efficacy which leads to decrease in market share.

Many events took place this quarter such as the closing of the Ford & Chrysler plant and decrease in production cost for product 1 which caused some opportunities and threats for our company. We now have a decreased production cost which leads to higher profit margin and net profit. With the loss of jobs in Chrysler and Ford we can decrease costs to the sales force and reduce commission amount. The threats to these events are as follows. There is an industry shrink in our biggest target market which can cause reduction in sales. Our competitors could reduce their prices dramatically which will also cause an increase in competition and our product is in the decline stage in its life cycle. These are the few variables concluded from this SWOT analysis.

Key Differentiator

The key differentiators to our product compared to other companies are that we must develop a competitive advantage if we

want our product to succeed further on. More features must be implemented to compete with other businesses and drive our

sales up and to be able to succeed for the rest of final quarters. Currently our net profits are in the negative and by reducing

advertising this will regulate our expenses compared to revenue. In the next quarter due to Ford & Chryslers shut down we

will decrease spending in advertising as well as lower the commission rate. We will utilize a pull strategy and focus on

consumer magazine ads combined with premium pricing strategies in order to compete with our main companies, Company

7,4,3,9.


Product 1 Marketing Strategy

Marketing Objectives Our strategies for Product 2 for each region are as follows:

1. Region 1:

a. Price: Premium Strategy with price at $19.99

b. Product: 2 features

$2.70 of quality per unit

c. Place: 3 sales reps

d. Promotion: Promotional spending will decrease due to focus on increasing net profit & market share from

negative. (Refer to Appendix 16 and 17)

Ad message will be “Quality”

Push/Pull with emphasis on Pull

2. Region 2:





Promotion: Promotional spending will decrease due to focus on increasing net profit & market share

from negative.



3. Region 3:

a. Price: Comparative Pricing Strategy with price at $17.97




a. Promotion: Promotional spending will decrease due to focus on increasing net profit & market share from

negative. (Refer to Appendix 16 and 17)



Product 1 is on the decline on the PLC which means there needs to be incentives for the consumer to buy the product that we

are selling. Currently our company for product 1 is the dog, with low market share and low market growth. Our company must

focus on extras to offer our customers compared to the competitors. Based on all models and graphs our Product 1 is

suffering from loss in revenue from a negative net profit. Product 1 is being hit hard in every region with carrying costs and

excessive advertising a few things that need to change. Adding features is a must to make our product stand out over the

competition others wise our company might suffer heavily in a certain region. Going forward we will increase features,

decrease spending on advertising and decrease commission to sales reps. Our Ad messages will focus on features for Region 1

and 2 and pricing for region 3. This will help give us a competitive advantage over other competitors.


Financial Objectives

We are predicting that the total market sales for Product 1 would be increased because of decreasing in cost of production;

therefore, other companies might decrease the prices for P1 to attract more customers. As market might expand, our

company is cutting cost of operations which result in advertising and promotions cut off, so our unit sales would slightly

increase compare to quarter 4. We are looking for the profit of $14,528 and 1% of return on sales because of current low

market shares and low rate of sales growth.

Specific Financial Goals are: Region 1 Region 2 Region 3

$ Sales $459,590 $219,890 $682,860

Units Sales 23,000 11,000 38,000 Market Share 6.1% 6.2% 8.7%

Profitability $ 11,637.00 Return on Sales 0.85%

Target Markets

Product 1 is a low cost, well known product that’s on the decline the PLC. Its margins have been decreasing over time.

Although there still a market for our product in the 3 regions. Region 1 holds 40% of the wealthy population and that is open

to new ideas. Although our product is well know we can still market to them as a premium product. Region 2 holds 20% of our

target population, which is wealthy and open to new ideas. The way we position our product to them is as a mid-ranged well

known product. The market attractiveness in this region is Low. Finally our biggest target market is Region 3, 40% of our target

market is in this region and it’s our most profitable region as well. This region is our primary region and our product is

positioned as a low cost, well known product.

Figure 9: Segmentation and Positioning

Region Segmentation & criteria Description

Market Attractiveness (High, Medium, Low)

Target Market(Primary, Secondary and/or exit)

Positioning Statement

Region 1

40% of the population

Wealthy and upscale

Open to new ideas

Relative affluent

Medium

Secondary Product 1 is positioned as a

premium well known product.

Region 2


Wealthy and upscale

Open to new ideas

Relative affluent

Low Secondary Product 1 is positioned as a well-

known mid-range product

Region 3


Resistant to new ideas

Less affluent

Bargain hunters

High Primary Product 1 is positioned as a low

cost well known product


Based on figure 9 to conclude Region 1 our product 1 targeted at 40% of the population in that region looking for a premium

product and is open to new ideas. Our product is positioned as a premium product and will continue to be premium in this

region. It is a secondary target market it and has medium market attractiveness. Region 2 is will continue to be a mid-ranged

product since it’s a smaller population that our target market is focused on. This region is a secondary target market, which is

wealthy and open to new ideas. Finally Region 3 is the main target region, this region is where our company spends most

funds marketing to since it’s our primary market. Our market attractiveness is high because 40% of the population is resistant

to new ideas, and looking for bargains. With low prices and a well know product is the best way to suit this region. Our

company will continue to advertise more in this region because it’s the most profitable for this product compared to the other

regions.

Marketing Mix

The main focus for Product 1 in current Regions have taken a different approach compared to previously. Our spending goes

more towards features and a dramatic drop in advertising in all types. We kept very few decisions the same and mostly

focused on increasing our net profits to become a more profitable company. We will change our pricing strategy for the most

part and offering premium pricing as well as a pull promotional strategy. We will decrease all advertising this following quarter

to improve the negative net profit to be a more suitable to our company. We’ll continue to monitor the forecast in sales

compared to inventory to minimize carrying costs.

Figure 10: Product 1 Region 1 Marketing Mix Strategy & Tactics

Marketing Mix

Strategy Specific Tactics for Q5 (what are your exact decisions going to be?)

Explanation

Product Differentiated Quality: $2.70 Features: $55,000 Process improvements: $0

Investing in features in order to achieve the market demand and to compete with other competitors.

Price Premium Pricing $ 19.99 Price will continue the same because the cut out cost of production will not affect until quarter 6.

Promotion Pull

Sales Promotion $23,000

We’re looking to invest in features in order to compete within the industry and to attract more customers. In order to improve net profit from negative to positive, costs of operations such as advertising, promotion, sales reps commission, social media, and SEO will be cut off for Q5. Pull strategy will be use to engage customers with P1 as product with more features and benefits.

Consumer Mag Ads 8

Trade Publication 3

Sales Reps Commission 2.80%

Features $40,000

Quality $2.70

Ad message Quality

Social Media $5,000

SEO $5,000

Place Medium Hire: 0 Fire: 0 Total: 0

No changes will be made regarding hiring or firing sales representatives.



Marketing Mix

Strategy P1, R2 Specific Tactics for Q5 (what are your

exact decisions going to be?) Explanation

Product Differentiated Quality: $2.70 Features: $55,000 Process improvements: $0

We are investing more into our product features. This will help differentiate our product from the competitor.

Price Premium Pricing $ 19.99 Price will continue the same because the cut out cost of production will not affect until quarter 6.

Promotion Pull


The direction we are taking is a decrease in all aspects of the business including spending in advertising to social media and search engine optimization etc. We are heavily focused on improving the amount of features we have for this product. We would like to have a product to better compete with the other companies. We want our consumers to choose our product over others for the variety of features we offer.

Consumer Mag Ads 4

Trade Publication 2

Sales Reps Commission: 2.80%

Features: $40,000

Quality $2.70

Ad message Quality

Social Media $5,000

SEO: $5,000

Place Low Hire: 0 Fire: 0 Total: 0




Marketing Mix

Strategy P1, R3 Specific Tactics for Q5 (what are

your exact decisions going to be?)

Explanation

Product Differentiated Quality: $2.70 Features: $55,000 Process improvements: $0.00

We are investing more into our product features. This will help differentiate our product from the competitor.

Price Competitive Pricing $ 17.97 Price will continue the same because the cut out cost of production will not affect until quarter 6.

Promotion Pull

Price $17.97

The direction we are taking is a decrease in all aspects of the business including spending in advertising to social media and search engine optimization etc. We are heavily focused on improving the amount of features we have for this product. We would like to have a product to better compete with the other companies. We want our consumers to choose our product over others for the variety of features we offer.


Consumer Mag Ads 10

Sales Reps

Commission 2.80%

Features $40,000

Quality $2.70

Ad message Price

Social Media $ 5,000

SEO $5,000

Place Low Hire: 0 Fire: 0 Total: 0



Product 1 Appendices

Appendix 4

Appendix 5

Co. 1

Co. 2

Co. 3Co. 4

Co.5

Co. 6

Co. 7

Co. 8

Co. 9

Co. 10

Co. 1115

15.5

16

16.5

17

17.5

18

18.5

19

19.5

20

0 0.5 1 1.5 2 2.5 3 3.5

Pri

ce

Quality

Perceptual Map P1,R1,Q4

Series1

Co. 1

Co. 2

Co. 3Co. 4

Co. 5

Co. 6

Co. 7

Co. 8

Co. 9

Co. 10

Co. 1115.99

16.49

16.99

17.49

17.99

18.49

18.99

19.49

19.99

0 0.5 1 1.5 2 2.5 3 3.5

Pri

ce

Quality


Series1


Appendix 6

Appendix 7 - P1/R1 Q4 Competitive Analysis

Quarter 4 Research Results Product 1 Region 1

Team Units Sold

Price Sales Promo

Mag Ads

Trade Pub

Ad Message

Sales Reps

Quality

Google

F-Book

Twitter

Feature

Market Share

1 21694 19 35000 9 10 Price 3 0.5 No

Rank 1192 556 0 6.0%

2 34450 16.5 35000 10 8 Price 4 0.5 No

Rank 1444 674 0 9.5%

3 33924 19.99 35000 10 8 Quality 6 3.5 Pg. 2 Pos 3

3730 1865 5 9.4%

4 31891 20 40000 13 8 Features 3 2.5 No

Rank

10542

6325 4 8.8%

5 26350 18.29 47500 8 9 Price 3 0.2 No

Rank 3116 1558 0 7.3%

6 26433 17.49 35000 5 10 Benefits 3 0 No

Rank 0 0 0 7.3%

7 40760 18.99 50000 12 6 Features 3 1 Pg. 1 Pos 8

3665 1832 8 11.3%

8 22991 19.99 35000 12 10 Features 3 1 Pg. 3 Pos 8

2843 1421 2 6.4%

9 30218 19 37000 10 10 Quality 4 3 No

Rank 0 0 0 8.4%

Co. 1Co. 2

Co. 3

Co. 4

Co. 5Co. 6

Co. 7Co. 8

Co. 9

Co. 10

Co. 11

14.98

15.48

15.98

16.48

16.98

17.48

17.98

18.48

18.98

0 0.5 1 1.5 2 2.5 3 3.5

Pri

ce

Quality


Series1


10 28477 16.49 20000 6 8 Price 2 0 Pg. 2 Pos 9

6680 4008 0 7.9%

11 63685 15 40000 12 6 Price 4 2 No

Rank

10221

6132 5 17.6%

360873 100.0%



Team Units Sold

Price Sales Promo

Mag Ads

Trade Pub

Ad Message

Sales Reps

Quality

Google

F-Book

Twitter

Feature

Market Share

1 13232 19 33000 9 9 Price 4 0.5 No

Rank 1192 556 0 7.5%

2 23708 16.5 40000 10 8 Price 3 0.5 No

Rank 1444 674 0 13.5%

3 15790 19.99 15000 5 3 Quality 3 3.5 Pg. 2 Pos 3

3730 1865 5 9.0%

4 18186 20 32000 9 7 Features 2 2.5 No

Rank

10542

6325 4 10.4%

5 13165 18.29 37000 5 7 Price 2 0.2 No

Rank 3116 1558 0 7.5%

6 15424 17.2 20000 5 5 Benefits 3 0 No

Rank 0 0 0 8.8%

7 0 15.99 0 0 0 Price 0 1 Pg. 1 Pos 8

3665 1832 8 0.0%

8 10832 19.99 18000 8 5 Features 2 1 Pg. 3 Pos 8

2843 1421 2 6.2%

9 16130 19 7000 10 10 Quality 3 3 No

Rank 0 0 0 9.2%

10 18148 16.49 20000 6 8 Price 1 0 Pg. 2 Pos 9

6680 4008 0 10.3%

11 30772 16 20000 9 6 Price 3 2 No

Rank

10221

6132 5 17.5%

175387 100.0%



You add this!


Team Units Sold Price

Sales Promo

Mag Ads

Trade Pub

Ad Message

Sales Reps

Quality

Google

F-Book

Twitter

Feature

Market Share

1 44555 16 42500 14 12 Price 5 0.5 No

Rank 1192 556 0 10.3%

2 38141 15.75 40000 10 8 Price 3 0.5 No

Rank 1444 674 0 8.9%

3 43535 18.99 35000 12 7 Service 7 3.5 Pg. 2 Pos 3 3730 1865 5 10.1%

4 34263

18 38000 11 7 Price 3 2.5

No

Rank

10542 6325 4 8.0%

5 38406 16.29 47000 9 12 Price 5 0.2 No

Rank 3116 1558 0 8.9%

6 29926 16.48 35000 9 10 Price 3 0 No

Rank 0 0 0 7.0%

7 50870 18 47000 15 10 Features 4 1 Pg. 1 Pos 8 3665 1832 8 11.8%

8 37275 17.97 40000 17 12 Price 3 1 Pg. 3 Pos 8 2843 1421 2 8.7%

9 29282 18.5 37000 12 12 Quality 4 3 No

Rank 0 0 0 6.8%

10 42442 14.98 35000 7 10 Price 4 0 Pg. 2 Pos 9 6680 4008 0 9.9%

11 41822

16 30000 5 8 Price 3 2

No

Rank

10221 6132 5 9.7%

430517

100.0%


Appendix 10 - P1/R1 Q4 Break Even Analysis Product 1 P1/R1

Selling Price $ 19.99

Total Per Unit Product Cost (COGS report) $ 12.20

Per Unit Contribution Margin $ 7.79

Total Promotion (from S&A Report) $ 103,000.00

Total Sales Force Costs (from S&A Report) $ 28,787.00

Total Selling Costs $ 131,787.00

Break Even Point/units (BE on Selling Costs) 16,917.46

Actual Units Sold Q4 (from Warehouse Report) 22,991.00

Difference between units sold and B/E units 6,073.54

Did you Break Even? Yes

How much did this P/R contribute to Profits? (Unit Cont. margin x number of units over break-even)

$47,312.89



Total Per Unit Product Cost (COSG Report) $ 12.20










$ 7,886.28




Total Per Unit Product Cost (COSG Report) $ 12.20










$ 47,982.75

0

5000

10000

15000

20000

25000

30000

35000

40000

Q1 Q2 Q3 Q4

Appendix 13 - Product 1/Region 1 Inventory Analysis

Your Forecast

Actual sales

Ending Inventory


0

5000

10000

15000

20000

25000

Q1 Q2 Q3 Q4

Appendix 14 - Product 1/Region 2 Inventory Analysis

Forecast

Actual sales

Ending Inventory

0

10000

20000

30000

40000

50000

60000

Q1 Q2 Q3 Q4

Appendix 15 - Product 1/Regon 3 inventory Analysis

Forecast

Actual sales

Ending Inventory


Appendix 16 - Product 1 Region 1,2,3, Sales Projections and Market Share

P1/R1 Q1 Q2 Q3 Q4 Q5 Projection

Your Sales in Units (from Warehouse Report)

32,301 31,522 27,205 22,991 23,000

Your Selling Price (from Decisions)

$ 17.99 $ 18.99 $ 19.99 $ 19.99 $ 19.99

Your Total Sales $ $ 581,094.99 $ 598,602.78 $ 543,827.95 $ 459,590.09 $ 459,770.00

Your Quarter over Quarter growth (in Units)

n/a -2.4% -13.7% -15.5% 0.04%

Total Industry Sales (in unites from Research Report

377,439 396,480 364,029 360,873 380,000

Total Industry Quarter over Quarter growth (in units)

n/a 5.0% -8.2% -0.9% 5.3%

Your Market Share 8.6% 8.0% 7.5% 6.4% 6.1%



11,999 11,477 11,028 10,832 11,000


$ 17.99 $ 18.99 $ 19.99 $ 19.99 $ 19.99

Your Total Sales $ $ 215,862.01 $ 217,948.23 $ 220,449.72 $ 216,531.68 $ 219,890.00


n/a -4.4% -3.9% -1.8% 1.6%


171,816 188,045 175,790 175,387 177,000


n/a 9.4% -6.5% -0.2% 0.9%




42,706 35,972 36,505 37,275 38,000



$ 16.97 $ 17.97 $ 17.97 $ 17.97 $ 17.97

Your Total Sales $ $ 724,720.82 $ 646,416.84 $ 655,994.85 $ 669,831.75 $ 682,860.00


n/a -15.8% 1.5% 2.1% 1.9%


477,373 486,975 498,614 430,517 435,000


n/a 2.0% 2.4% -13.7% 1.0%


Total Product 1 Sales ($)

$ 1,521,677.82 $ 1,462,967.85 $ 1,420,272.52 $ 1,345,953.52 $ 1,362,520.00

Appendix 17 - Product 1 Total Return on Sales

Product 1 Total Q1 Q2 Q3 Q4 Q5 Projection

Total Sales Product 1 (Appendix 16)

$ 1,521,677.82 $ 1,462,967.85 $ 1,420,272.52 $ 1,345,953.52 $ 1,362,520.00

Net Income before Taxes Q1-Q4 (from Appendix 1) Net Income before Taxes Q5 (Appendix 18)

$ 148,288.00 $ (24,912.00) $ (41,891.00) $ (22,089.00) $ 11,637.00

Return on Sales 10% -2% -3% -2% 0.85%


Appendix 18 - Q5 Projections and Performance Expectations for Product 1

Q5 Forecast

Q5 Forecast


Product 2

Product 2 Environmental Scan

PEST We used a PEST analysis to help with our environmental scan. In Q5 there are some industry changes that are coming in to

affect. These changes will affect all companies in the industry. Figure 13 demonstrates our PEST analysis with all the affecting

factors to Product 2.

Figure 13: PEST Product 2

PEST Analysis

Trends identified from Industry Changes announced by Chairman of the Board

Possible Impact in each region

Political Government of Canada reduces Prime Lending Rate from 10% to 7%

Government imposes increased taxes on one of the major components required in the production of Product 2 leading to cost of product 2 rising from $27.00-$28.00

The Prime Lending Rate shrinking will impact every Region of our company in a positive way. This will help towards our overall Net Income due to lower payments

The cost of Product 2 rising will affect every Region once again in regards to our overall Costs of Goods Sold

Economic Auto Industry shrinking leading Ford to lay off 200 jobs in Region 3.

This will affect our sales in Region 3 due to lower income and consumers not being able to afford our product

Social Society becoming more technology savvy

Positively affect Product 2 demand in all regions since Product 2 is a technologically based product

Technological No technological trends affecting Product 2

In conclusion the industry changes will have both positive and negative effects on our product. The Prime Lending Rate

decreasing by 3% will help us save money and lead to an overall better net income. The cost of product 2 raising a $1.00 will

affect our margins a bit and we may lose sales in Region 3 due to lose of jobs. However we will potentially be getting more

sales due to the social factor of society becoming more technology savvy. With this being said, the changes may all even out

and not make that big of a difference in the following quarters.


Competitive Analysis The competitive analysis consists of charts with every company and their data along with perceptual maps based on quality

and price for each team. For all three regions we broke down our full competitive analysis into charts for our top three

competitors. This will give us a better understanding of what needs to be done to be at the top.

(Figure 14 is extracted from Appendix 22)

In Region 1 Team 7, 3 and 6 are our main competitors due to the fact of their success and pricing/quality strategy (Refer to

perceptual map 4). As of now Team 6 is a low threat level but if they were to drop their price or raise quality they could be at

high level. They are high potential competition and need to be watched. Team 7 and 3 both put a lot of money in to sales

promotion, work on a push strategy, and have high quality like us. (Refer to Appendix 22). This is what is working well in the

industry based on results, but we need to find more ways to differentiate ourselves compared to our lead competitors.

(Figure 15is extracted from Appendix 23)

Once again in Region 2 Team 7, 3 and 6 are our main competitors due to fact of their success and pricing/quality strategy.

Region 1 and Region 2 are very identical just a bit more money spent in Region 1 and more sales reps due to the size

difference (Refer to Appendix 22 and 23). High quality and pricing is valued in this region and is proven in the results (refer to

Appendix 23). Our strategies are very similar to our main competitors. To rise above them we should invest more into our

push strategy (trade publications) and add another sales rep to keep up with them.


(Figure 16 is extracted from Appendix 24)

Region 3 has different affecting factors compared to Region 1 and 2 but the main competitors are still Team 7, 3 and 6.

Region 3 is our highest region for market share. We dropped our price and kept the same quality while Team 7 (#1

competitor) didn’t do either which gave us a huge advantage in this region (Refer to Perceptual map 6). Team 3 didn’t make

many changes and only dropped their price by $0.50. Team 6 is still a high potential competitor. As far as changes go we

need to continue to emphasis on our promotion, and remain a high quality product with a lower price than average.


SWOT Figure 17 demonstrates the Strength, Weaknesses, Opportunities and Threats of Product 2. While analyzing this chart we can

see what needs to be continued, what needs to be fixed, what we can take advantage of to succeed, and what we need to

watch out for.

Figure 17: SWOT Product 2

SWOT ANALYSIS – PRODUCT 2 Strengths: High Net Income (refer to Appendix 32) Second largest Market Share in Region 1 (refer to Appendix 22) Third largest Market in Region 2 (refer to Appendix 23) Largest Market Share in Region 3 (refer to Appendix 24) High degree Quality compared to industry standard (refer to Perceptual Maps 4-6/Appendix 22-24) Second largest Social Media following (refer to Appendix 22) Consistent Ad Message (refer to Appendix 34) Break even every quarter and every region (Refer to Appendix 25-27) Consistent growth in each region in Quarters 1,2, and 4 (Refer to Appendix 36)

Weaknesses:

1. Experienced stock out in Region 1, Quarter 3 2. Low Inventory levels (refer to Appendix 28-30)

Opportunities: 1. Market set to grow due to consumers becoming more technology savvy (Refer to Product 2 PEST) 2. Team 12 has gone bankrupt leaving market share up for grabs (Refer to Appendix 22-24) 3. Team 6 seems to have withdrawn Product 2 from all regions leaving market share up for grabs (Refer to Appendix 22-24)

Threats: 1. Rising Product Cost (refer to Product 2 PEST) 2. 200 jobs lost in Region 3 which may potentially stagnant market growth in Region 3 (Refer to Product 2 PEST) 3. Team 7 has consistently grown at a rate far larger than the industry average in each region (Refer to Appendix 35 and Appendix 37) 4. Team 3 increased sales substantially in region 3 (Refer to Appendix 38)

In conclusion, our money is being spent well as is indicated by our larger than average market share (Refer to Appendix 22-24. We have utilized a consistent strategy that seems to work well. In the future there are a lot more opportunities to grow due to factors in the overall industry and we need to work strategies around that. A major weakness we need to work on is our inventory levels, which can harm us a lot in the future. There are some threats that may affect our sales in the following quarters due lose jobs in Region 3 so they won’t be purchasing our product. Team 7 has consistently grown at a rate larger than the industry that means they could be taking our potential market share. We need to be aware of these threats and take advantage of the opportunities.

Key Differentiator

We are the only company that has a consistent ad message of Quality in all regions (Refer to Appendix 22-24, and 34). People

value our fairly priced product that provides a high degree of quality.


Product 2 Marketing Strategy

Marketing Objectives Our strategies for Product 2 for each region are as follows:

4. Region 1:





d. Promotion: Promotional spending will decrease due to potential stock outs (Refer to Appendix 28 and 33)


Push/Pull with emphasis on Push

5. Region 2:





d. Promotion: Promotional spending will decrease due to potential stock outs (Refer to Appendix 29 and 33)



6. Region 3:

d. Price: Market Orientated Strategy with price at $75.00

e. Product: 4 features


f. Place: 5 sales reps

g. Promotion: Promotional spending will decrease due to potential stock outs (Refer to Appendix 30 and 33)



The market for Product 2 continues to grow, though growth has begun to slow. Whether or not this growth is reflective of the

market becoming overly saturated or if it is just a seasonal change cannot be fully seen until the end of Quarter 5. Product 2

continues to perform as a star in each region, with unit sales, and market share among the leaders in each region (Refer to

Appendix 22, Appendix 23, and Appendix 24). Team 8 has been successful in marketing Product 2 as a premium priced,

premium quality product and will continue to focus on those aspects to maintain consistency. Product 2 has consistently

outsold expectations leading to alarmingly low levels of inventory in each region. To counter this, advertising and promotional

spending has been reduced to prevent demand from exceeding supply. Feature development spending has been stopped for

Product 2 as we are comfortable with the number of features the product has (4) and we do not wish to increase our

production costs any further. Our consistency and ability to cater to the needs of each region has helped establish us as the

number one company.


Financial Objectives

Team 8’s Product 2 is an industry leader in sales and market share (Refer to Appendix 22, Appendix 23, and Appendix 24) in

each region. Due to the potential of stock outs in each region, promotion and ad spending has been reduced in each region

(Refer to Appendix 22, Appendix 23, Appendix 24, and Appendix 33) to reduce growth to a manageable level. As a result,

Region 1 will see a decrease in $ Sales, Unit Sales, and Market share. Region 2 will see a minimal increase in growth, and

Region 3 will experience significant growth.

Region 1 Region 2 Region 3

$ Sales $897,372.00 $566,664.00 $906,390.00 Units Sales 10,683 6,746 12,085

Market Share 10.4% 12.3% 14.6% Profitability $348,062

Return on Sales 29%


Target Markets

Team 8 values each of Mavlandia’s 3 regions highly and is committed to being the sales leader in each region. Due to their

large populations, Region 3 and Region 1 are the highest priorities when it comes to promotional spending and sales reps

(Refer to Appendix 22, Appendix 23, and Appendix 24). Regions 1 and 2 have shown that they are willing to pay a high price

for a high quality product and therefore Team 8 will continue to promote a premium quality product at a premium price.

Region 3 has shown that it values low price above high quality and therefore Team 8 will continue offering its premium

product at a lower price than that of other premium product providers.

Figure 18: Segmentation and Positioning

Region Segmentation & criteria Description Market Attractiveness (High, Medium, Low)

Target Markets (Primary, Secondary and/or exit)

Positioning Statement

Region 1 40% of overall population

Relatively affluent

Open to new ideas

Responds well to quality for Product 2 (Refer to Appendix 22)

Willing to pay a high price (Refer to Appendix 22)

High Primary Team 8 provides a high quality product to Region 1 for tech savvy affluent consumers that can be found everywhere.


Relatively affluent

Open to new ideas

Responds very well to quality for Product 2 (refer to Appendix 23)

Willing to pay a high price (Refer to Appendix 23)

High Primary Team 8 provides a high quality product for Region 2 for tech savvy affluent consumers that can be found in select retailers.


Less affluent

Bargain hunters

Does not respond to high quality products (Refer to Appendix 24)

Prefer lower prices (Refer to appendix 25)

High Primary Team 8 provides a premium quality product at a lower price than other premium product providers for Region 3 that can be found everywhere.

Region 1 and 2 continue to be affluent, and are willing to pay a premium price for a high quality product. Region 3 is still the

least affluent region; however the social acceptance of technology has made them more open towards buying Product 2 (See

Product 2 PEST). All regions have also shown that companies who spend large amounts on social media activity and SEO are

likely to have higher than average sales (Refer to Appendix 22-24).


Marketing Mix The main focus for Product 2 is to continuously increase market share, thus increasing net revenue. The majority of spending

is focused on sales promotion, consumer magazine ads, and trade publication ads. Due to our past success no strategic

changes have been made, however spending has been reduced to prevent potential stock outs in each region. We continue to

use premium pricing, and spend above the industry average on quality (Refer to Perceptual Maps 4, 5, and 6). As the market is

still growing, we will continue to use a push strategy to get our product into stores.


Marketing

Mix Strategy

Specific Tactics for Q5 (what

are your exact decisions going

to be?)

Explanation

Product Differentiated

based on Quality

Quality: $7.00

Features: 4

Feature Development: $0

Process improvements: $0

Feature development stopped due

to rising product costs. Money

should be spent on quality over

features as quality is the key ad

message. (Refer to Appendix 22)

Price Premium Pricing $84.00

Price is kept the same due to past

success. (Refer to Appendix 22 and

Appendix 33)

Promotion Pull/Push with an

emphasis on Pull


Sales Promotion and consumer

ads dropped due to projected

stock outs. Trade publications

dropped due to projected stock

outs (Refer to Appendix 22, 28 and

33)

Consumer Mag Ads 12

Trade Publication 18

Sales Reps

Commission 5.00%

Social Media Activity $20,000

SEO $20,000

Place Medium

Hire: 0

Fire: 0

Total: 0

No changes will be made

regarding hiring or firing sales

representatives.



Marketing

Mix Strategy



to be?)

Explanation


based on Quality

Quality: $7.00

Features: 4








Price Premium Pricing $84.00



Appendix 33)


emphasis on Pull






outs (Refer to Appendix 23, 28 and

33)

Consumer Mag Ads 12


Sales Reps

Commission 5.00%


SEO $20,000

Place Medium

Hire: 0

Fire: 0

Total: 0



representatives.



Marketing

Mix Strategy



to be?)

Explanation


based on Quality

Quality: $7.00

Features: 4








Price Market Orientated

Pricing $75.00



Appendix 33)


emphasis on Pull






outs (Refer to Appendix 24, 30,

and 33)

Consumer Mag Ads 12


Sales Reps

Commission 5.00%


SEO $20,000

Place Medium

Hire: 0

Fire: 0

Total: 0



representatives.


Product 2 Appendices:

Appendix 19 - P2/R1 Price/Quality Perceptual Map


1

2

3

4

5

67

8

9

10

11

$55.00

$60.00

$65.00

$70.00

$75.00

$80.00

$85.00

$90.00

$- $2.00 $4.00 $6.00 $8.00 $10.00

P2/R1 Price/Quality Perceptual Map

1

2

3

4

5

67

8

9

10

11

$60.00

$65.00

$70.00

$75.00

$80.00

$85.00

$90.00

$- $2.00 $4.00 $6.00 $8.00 $10.00




1

2

3

4

5

6

7

8

9

10

11

$55.00

$60.00

$65.00

$70.00

$75.00

$80.00

$85.00

$90.00

$- $2.00 $4.00 $6.00 $8.00 $10.00





Sales

Promotion Mag Ads Trade Pub

Ad

Message

Sales

Reps Quality Google F-Book Twitter Feature

Market

Share

1 7,442 60.00$ 35,000.00$ 9 8 Price 5 $ 0.50 No Rank 494 335 0 7.4%

2 7,619 72.00$ 35,000.00$ 10 17 Benefits 5 $ 3.00 No Rank 507 344 0 7.6%

3 11,644 83.99$ 35,000.00$ 7 20 Benefits 5 $ 10.00 Pg 2 Pos 4 7,287 4,318 5 11.6%

4 7,593 72.00$ 45,000.00$ 14 13 Quality 5 $ 2.00 Pg 2 Pos 5 1,416 889 0 7.6%

5 10,871 63.49$ 50,000.00$ 14 17 Price 6 $ 0.30 Pg 2 Pos 6 1,722 1,082 0 10.8%

6 4,279 89.00$ -$ 0 0 Service 8 $ 5.00 Pg 2 Pos 10 - - 5 4.3%

7 13,598 86.99$ 60,000.00$ 7 21 Benefits 6 $ 7.00 Pg 1 Pos 15 8,134 4,820 8 13.5%

8 12,317 84.00$ 45,000.00$ 15 22 Quality 6 $ 7.00 Pg 2 Pos 17 7,761 4,599 4 12.3%

9 6,497 72.00$ 35,000.00$ 12 15 Benefits 6 $ 2.00 No Rank 422 286 0 6.5%

10 10,129 55.99$ 45,000.00$ 4 8 Quality 4 $ 1.00 Pg 1 Pos 19 6,751 4,000 2 10.1%

11 8,418 66.00$ 35,000.00$ 12 14 Price 6 $ 2.00 No Rank 2,754 2,164 0 8.4%

100,407 100.0%

Figure 14Quarter 4 - Top Competitors Product 2 Region 1

Team

Product

Strategy

Price

Strategy

Promo

Strategy

Place

Strategy

Market

Share

Threat

Level

Your Co. 8 Quality Premium Push Medium 12.27%

First 7 Benefits Premium Push Medium 13.54% High

Second 3 Benefits Premium Push Medium 11.59% High

Third 11 Price Penetration Push High 8.40% Low





Sales


Ad

Message

Sales


Market

Share

1 4,316 63.00$ 33,000.00$ 7 7 Price 5 $ 0.50 No Rank 494 335 0 8.1%

2 4,698 72.00$ 25,000.00$ 10 17 Benefits 4 $ 3.00 No Rank 507 344 0 8.8%

3 6,914 83.99$ 32,000.00$ 5 18 Benefits 5 $ 10.00 Pg 2 Pos 4 7,287 4,318 5 12.9%

4 3,944 72.00$ 35,000.00$ 10 10 Quality 4 $ 2.00 Pg 2 Pos 5 1,416 889 0 7.4%

5 4,003 63.29$ 35,000.00$ 5 7 Features 4 $ 0.30 Pg 2 Pos 6 1,722 1,082 0 7.5%

6 2,189 89.00$ -$ 0 0 Service 5 $ 5.00 Pg 2 Pos 10 - - 5 4.1%

7 6,761 86.99$ 30,000.00$ 5 20 Benefits 5 $ 7.00 Pg 1 Pos 15 8,134 4,820 8 12.7%

8 6,356 84.00$ 32,500.00$ 15 18 Quality 4 $ 7.00 Pg 2 Pos 17 7,761 4,599 4 11.9%

9 4,154 72.00$ 35,000.00$ 12 14 Benefits 5 $ 2.00 No Rank 422 286 0 7.8%

10 5,408 60.00$ 40,000.00$ 3 6 Quality 4 $ 1.00 Pg 1 Pos 19 6,751 4,000 2 10.1%

11 4,681 66.00$ 35,000.00$ 10 10 Price 3 $ 2.00 No Rank 2,754 2,164 0 8.8%

53,424 100.0%


Team

Product

Strategy

Price

Strategy

Promo

Strategy

Place

Strategy

Market

Share

Threat

Level


First 7 Benefits Premium Push High 12.70% High

Second 3 Benefits Premium Push High 12.90% High

Third 11 Price Penetration Balanced Low 8.80% Low




Sales


Ad

Message

Sales


Market

Share

1 5,895 65.00$ 38,500.00$ 12 10 Price 6 $ 0.50 No Rank 494 335 - 7.6%

2 5,809 69.00$ 35,000.00$ 10 14 Benefits 5 $ 3.00 No Rank 507 344 - 7.4%

3 8,431 83.50$ 30,000.00$ 7 21 Benefits 6 $ 10.00 Pg 2 Pos 4 7,287 4,318 5 10.8%

4 6,621 65.00$ 40,000.00$ 11 11 Price 6 $ 2.00 Pg 2 Pos 5 1,416 889 - 8.5%

5 7,208 56.99$ 45,000.00$ 9 8 Price 5 $ 0.30 Pg 2 Pos 6 1,722 1,082 - 9.2%

6 3,747 75.00$ -$ 0 0 Price 6 $ 5.00 Pg 2 Pos 10 - - 5 4.8%

7 9,766 84.99$ 40,000.00$ 7 21 Benefits 7 $ 7.00 Pg 1 Pos 15 8,134 4,820 8 12.5%

8 10,071 75.00$ 42,500.00$ 15 17 Quality 5 $ 7.00 Pg 2 Pos 17 7,761 4,599 4 12.9%

9 4,444 70.00$ 35,000.00$ 12 12 Benefits 6 $ 2.00 No Rank 422 286 - 5.7%

10 9,466 55.99$ 55,000.00$ 4 8 Price 4 $ 1.00 Pg 1 Pos 19 6,751 4,000 2 12.1%

11 6,574 66.00$ 35,000.00$ 14 16 Price 5 $ 2.00 No Rank 2,754 2,164 - 8.4%

78,032 100.0%


Team

Product

Strategy

Price

Strategy

Promo

Strategy

Place

Strategy

Market

Share

Threat

Level


First 7 Benefits Premium Push High 12.50% High

Second 3 Benefits Premium Push High 10.80% High

Third 11 Price Penetration Push Medium 8.40% Low


Appendix 25 - P2/R1 Q4 Break Even AnalysisProduct 2 P2/R1

Selling Price 84

Total Per Unit Product Cost (COSG Report) 35.2

Per Unit Contribution Margin 48.8

Total Promotion (from S&A Report) 149,000

Total Sales Force Costs (from S&A Report) 81,731

Total Selling Costs 230731

Break Even Point/units (BE on Selling Costs) 4728.094

Actual Units Sold Q4 (from Warehouse Report) 12317

Difference between units sold and B/E units 7588.906


How much did this P/R contribute to Profits?

(Unit Cont. margin x number of units over break

even) 370338.6


Selling Price 84



Total Promotion (from S&A Report) 128500

Total Sales Force Costs (from S&A Report) 46695



Actual Units Sold Q4 (from Warehouse Report) 6356




(Unit Cont. margin x number of units over

break even) 134977.8



Selling Price 75



Total Promotion (from S&A Report) 136,500

Total Sales Force Costs (from S&A Report) 62,766



Actual Units Sold Q4 (from Warehouse Report) 10,071




(Unit Cont. margin x number of units over

break even) 201559.8


Appendix 31 - Product 2 Region 1,2,3, Sales Projections and market share


Q5 Projection

% increase

Your Sales in Units (from Warehouse

Report) 6,770 9,083 8,333 12,317 10,683 -15.30%

Your Selling Price (from Decisions) 81.50$ 84.00$ 84.00$ 84.00$ 84.00$ 0.00%

Your Total Sales $ 551,755.00$ 762,972.00$ 699,972.00$ 1,034,628.00$ 897,372.00$ -15.30%

Your Quarter over Quarter growth (in Units) n/a 34.2% -8.3% 47.8% -13.3% 460.39%

Total Industry Sales (in unites from

Research Report 88,142 95,866 99,551 100,407 102,415 1.96%

Total Industry Quarter over Quarter growth

(in units) n/a 8.8% 3.8% 0.9% 2.0% 57.01%

Your Market Share 7.7% 9.5% 8.4% 12.3% 10.4% -17.60%


Q5 Projection

% increase


Report) 2,392 3,736 4,876 6,356 6,746 5.78%


Your Total Sales $ 194,948.00$ 313,824.00$ 409,584.00$ 533,904.00$ 566,664.00$ 5.78%

Your Quarter over Quarter growth (in Units) n/a 56.2% 30.5% 30.4% 6.1% -394.67%


Research Report 42,784 50,004 52,578 53,424 54,760 2.44%Total Industry Quarter over Quarter growth

(in units) n/a 16.9% 5.1% 1.6% 2.5% 35.64%

Your Market Share 5.6% 7.5% 9.3% 11.9% 12.3% 3.43%


Q5 Projection

% increase


Report) 3,452 7,141 6,573 10,071 12,085 16.67%


Your Total Sales $ 281,338.00$ 535,575.00$ 492,975.00$ 755,325.00$ 906,390.00$ 16.67%

Your Quarter over Quarter growth (in Units) n/a 106.9% -8.0% 53.2% 20.0% -166.09%


Research Report 70,268 73,914 78,049 78,032 82,714 5.66%

Total Industry Quarter over Quarter growth

(in units) n/a 5.2% 5.6% 0.0% 6.0% 100.36%

Your Market Share 4.9% 9.7% 8.4% 12.9% 14.6% 11.67%

Total Product 2 Sales ($) 1,028,041.00$ 1,612,371.00$ 1,602,531.00$ 2,323,857.00$ 2,370,426.00$ 1.96%


Appendix 32 - Product 2 Total Return on Sales

Product 2 Total Q1 Q2 Q3 Q4 Q5 Projection

Total Sales Product 2

(from Appendix 31) 1,028,041.00$ 1,612,371.00$ 1,602,531.00$ 2,323,857.00$ 2,370,426.00$ Net Income before

Taxes (Appendix 2) 126,293.00$ 289,777.00$ 242,986.00$ 599,084.00$ 698,054.00$

Return on Sales 12% 18% 15% 26% 29%


Appendix 33 - Q5 Projections and Performance Expectations for Product 2


Region 1 Region 2 Region 3

Q1 Ad Message Quality Quality Benefits

Q2 Ad Message Quality Quality Quality




Appendix 34 - P2 Ad Message Q1-Q5

Region 1 Region 2 Region 3 Total

Q1 Unit Sales 88,142 42,784 70,268 201,194

Q2 Unit Sales 95,866 50,004 73,914 219,784

Growth 8.76% 16.88% 5.19% 9.24%

Q3 Unit Sales 99,551 52,578 78,049 230,178

Growth 3.84% 5.15% 5.59% 4.73%

Q4 Unit Sales 100,407 53,424 78,032 231,863

Growth 0.86% 1.61% -0.02% 0.73%

Appendix 35 - Product 2 Market Growth & Trends


Q1 Unit Sales 6,770 2,392 3,452 12,614

Q2 Unit Sales 9,083 3,736 7,141 19,960

Growth 34.17% 56.19% 106.87% 58.24%

Q3 Unit Sales 8,333 4,876 6,573 19,782

Growth -8.26% 30.51% -7.95% -0.89%

Q4 Unit Sales 12,317 6,356 10,071 28,744

Growth 47.81% 30.35% 53.22% 45.30%

Appendix 36 - Team 8: Product 2 Market Growth & Trends


Q1 Unit Sales 6,376 2,647 2,282 11,305

Q2 Unit Sales 10,933 5,109 5,963 22,005

Growth 71.47% 93.01% 161.31% 94.65%

Q3 Unit Sales 12,051 5,609 6,993 24,653

Growth 10.23% 9.79% 17.27% 12.03%

Q4 Unit Sales 13,598 6,761 9,766 30,125

Growth 12.84% 20.54% 39.65% 22.20%

Appendix 37 - Team 7: Product 2 Market Growth & Trends


Region 3

Q1 Unit Sales 7,521

Q2 Unit Sales 5,929

Growth -21.17%

Q3 Unit Sales 4,990

Growth -15.84%

Q4 Unit Sales 8,431

Growth 68.96%

Appendix 38 - Team 7: Product 2

Market Growth & Trends


Conclusion

Overall Financial Analysis

Team 8 has shown consistent growth in terms of company sales in all quarters except for Quarter 3, where Product 2 sales

shrank due to the risk of stock outs, and Product 1 performed poorly. Product 2 has been the driving force behind the rise in

net income (Refer to Appendix 17 and Appendix 32) as it has consistently earned a positive net income, unlike Product 1

which has struggled from Quarter 2 to Quarter 4. While total company sales are expected to grow at a minimal rate (0.8%),

total company net income will grow at a far greater rate (20.43%) due to the decrease in advertising and promotional

spending by both products (Refer to Appendix 18 and 33). As a result, Team 8 will see another increase in total company

return on sales, and expects to remain the number 1 overall company.

Figure 22 – Overall Company Financials Q1-4 and Q5 Projection

Total company Sales

($) Total Company Net

Income Total Company Return on Sales

Standings in the Maven

Simulation

Q1 Actual $2,549,717 $137,291 5.38% 9

Q2 Actual $3,075,337 $132,433 4.30% 3

Q3 Actual $2,910,577 $100,547 3.45% 2

Q4 Actual $3,669,809 $288,497 7.86% 1

Q5 Projected $3,698,031 $362,590 9.80% 1


Statement of Direction Product 1 has been a dog for Team 8. It has not seen much market growth from quarter to quarter (Refer to Appendix 16),

with a negative net profit and a low market share. Product 1 has been doing best in Region 3 over the other 2 Regions but still

failed to maintain a positive net profit. Due to this our objectives and direction for Product 1 has changed and our company

will focus more on being a premium product for Region 1 and 2 while being comparative in Region 3. Investment in Sales

Promotion, Search Engine Optimization, Social Media Activity Consumer Ads and Trade Publications have been decreased in

Quarter 5 (Refer to Appendix 18), and Quality and Features have been invested on. In Region 1 and 2 Ad Message has been

switched to Quality rather than features (Refer to Appendix 18), to accommodate the direction of our product.

Product 2 has been a rising star for Team 8. It has seen consistent dramatic growth from quarter to quarter (Refer to Appendix

36), establishing itself as the best-selling product in Region 3, the second best selling product in Region 1, and the third best

selling product in Region 1 (Refer to Appendix 22-24). Team 8 has provided a consistent message to its Product 2 customers,

with an ad message built around quality and a price that has only changed once (Refer to Appendix 34). Due to larger than

expected growth in Quarter 4, we have made operational changes for Quarter 5, reducing advertising and promotional

spending in each region (Refer to Appendix 22-24 and 33) to reduce the risk of stock outs. In the following quarters we will

remain consistent with our strategies that have made us a top selling product, and we will become more aggressive in order to

continue to further our standing as a market leader.

Team 8 continues to trend upwards and is expected to continue its overall market dominance.

Product 2 has been a rising star for Team 8. It has seen consistent dramatic growth from quarter to quarter, establishing itself

as the best-selling product in Region 3, the second best selling product in Region 1, and the third best selling product in Region

1. Team 8 has provided a consistent message to its Product 2 customers, with an ad message built around quality and a price

that has only changed once. In the following quarters we plan to remain aggressive in order to continue to further our

standing as a market leader.

Team 8 continues to trend upwards and is expected to continue its overall market dominance.


Company Specific Appendices

Appendix 2 - Income Statement Product 2 Product 2 Qrt 1 Qrt 2 Qrt 3 Qrt 4

Total Sales $1,028,041.00 $1,612,371.00 $1,490,307.00 $2,323,857.00

COGS $ 403,648.00 $ 667,949.00 $ 620,879.00 $1,009,098.00

Gross Profit $ 624,393.00 $ 944,422.00 $ 869,428.00 $1,314,759.00

S&A $ 498,100.00 $ 612,317.00 $ 576,214.00 $ 701,692.00

Inventory Carry $ - $ 29,448.00 $ 37,148.00 $ 4,267.00

Operation Profit $ 126,293.00 $ 302,657.00 $ 256,066.00 $ 608,800.00

Interest Exp $ - $ 12,880.00 $ 13,080.00 $ 9,716.00

Income Before

Tax

$ 126,293.00 $ 289,777.00 $ 242,986.00 $ 599,084.00

Income Tax $ 63,146.00 $ 144,888.00 $ 121,493.00 $ 299,542.00

Net Income $ 63,147.00 $ 144,889.00 $ 121,493.00 $ 299,542.00

Appendix 1- Income Statement Product 1Product 1 Qrt 1 Qrt 2 Qrt 3 Qrt 4

Total Sales $ 1,521,676.00 $1,462,966.00 $1,420,270.00 $1,345,952.00

COGS $ 1,000,569.00 $ 908,166.00 $ 864,556.00 $ 837,351.00

Gross Profit $ 521,107.00 $ 554,800.00 $ 555,714.00 $ 508,601.00

S&A $ 372,819.00 $ 459,163.00 $ 440,160.00 $ 432,876.00

Inventory Carry $ - $ 69,591.00 $ 108,026.00 $ 73,781.00


Interest Exp $ - $ 50,958.00 $ 49,419.00 $ 24,033.00

Income Before Tax $ 148,288.00 $ (24,912.00) $ (41,891.00) $ (22,089.00)

Income Tax $ 74,144.00 $ (12,456.00) $ (20,945.00) $ (11,044.00)

Net Income $ 74,144.00 $ (12,456.00) $ (20,946.00) $ (11,045.00)


Appendix 3 - Income Statement Total Company

Total Sales Qrt 1 Qrt 2 Qrt 3 Qrt 4

Total Sales $ 2,549,717.00 $ 3,075,337.00 $ 2,910,577.00 $ 3,669,809.00

COGS $ 1,404,217.00 $ 1,576,115.00 $ 1,485,435.00 $ 1,846,449.00

Gross Profit $ 1,145,500.00 $ 1,499,222.00 $ 1,425,142.00 $ 1,823,360.00

S&A $ 870,919.00 $ 1,071,480.00 $ 1,016,374.00 $ 1,134,568.00

Inventory Carry $ - $ 99,039.00 $ 145,174.00 $ 78,048.00


Interest Exp $ - $ 63,838.00 $ 62,499.00 $ 33,749.00

Income Before Tax $ 274,581.00 $ 264,865.00 $ 201,095.00 $ 576,995.00

Income Tax $ 137,290.00 $ 132,432.00 $ 100,548.00 $ 288,498.00

Net Income $ 137,291.00 $ 132,433.00 $ 100,547.00 $ 288,497.00

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