Smart Business Venture - Report Example

Report Thesis: Uniqueness of the product can make it smart business venture To proceed with venture 2. International target markets 3. Target market segments 4. Socio-demographic and lifestyle characteristics of target consumers. 5. Standardisation versus adaptation and differentiation of the product. 6. Pricing strategy and Recommended Retail Price (RRP) 7. Development of a Shocker® Smartphone range of accessories 8. Marketing communication: advertising and promotion strategies 9. Scale of production (unit volume: pre-launch period and first four quarters following launch for each market) 1. To proceed with the launch The product launched by IMMO Tech is called ‘The Shocker Smartphone’. It is has all the features that a high-end Smartphone should have. It has wireless email, Organiser applications, messaging, etc. It also has entertainment options like media player, video recorder, 12.0 mega pixel camera and games, of course. It supports wi-fi and has 16 GB expandable memory. Therefore, it is definitely on par with the other Smartphones in the market. But what makes this product stand out is that, this product is also a personal defence system. Apart from performing the usual Smartphone functions, the IMMO Tech has designed it to perform the defence functions, too. It has personal security alarm, Integrated Global Positioning System (GPS). It has self-contained, rechargeable power cell. The most exciting feature of this product is the JOLT™ 1,000,000 volt ‘Stun Immobiliser’ function. This is the function that makes the product absolutely unique. It has great displays skills and also very high tech. as the slogan puts it, it is buzzing with technology. The product is one of its kind. It is an innovative product. The versatility of the product and the vast range of functions it performs makes it unarguably one of the best products in the market. It is high on technology. It is stylish. It is a great communicating device. Amazingly, it also provides security. In all aspects, it meets the demands of today generation. It is a first of its kind which combines communication and security in a compact device. It is a high-end product. It is great in style and on performance as well. It has great features. All things considered, the product is a good investment. People of 21st Century demand these things. Our product fulfills these demands. It will definitely appeal to today’s generation considering its versatility Hence IMMO tech should proceed with the launch 2. International target markets As described above, the product to be launched is a high-end product. Built with modern technology, it is slightly more advanced that the products currently available in the market. It makes sense to introduce the product in technologically advanced countries Thus, Western markets are the most convenient option. The Western nations are very open minded and welcoming when it comes to technology. Countries like Russia, Italy, Spain do not have any home companies providing such products. France, though, the fashion capital has nothing on its land that could provide such a versatile product. The German industry is basically an automobile industry. As IMMO tech is a UK based company, it will get advantage on its home turf. On the other hand, USA already has two great companies, namely ‘Apple’ and ‘Blackberry’ in this domain. They manufacture a wide range of smartphones and distribute it all over the world. Canada too, is a great market but it is also more partial to American products. So is Australia. But perversely, none of them provide the additional feature of personal defence system. Therefore, we can also target these markets. Though, the Chinese and Japanese markets can be very favourable, they do not have a very liberal economic policy. We can certainly launch our product but it will not be a very profitable investment. Asian countries like Malaysia, Singapore, Thailand are very good markets. As they are tourist destinations, they are very technologically advanced countries. Sri Lanka, India, etc are also favourable markets but not in the first quarter. In these countries it is better to gauge the reaction of the world first and then launch it in the second quarter. African markets are not a very good option. Mauritius might be an exception, though. Africa, though, developing at a rapid rate is not still ready for a high-tech product such as our product. Countries in the South American continent like Brazil, Mexico, Peru, etc are also good markets. To summarize, our primary markets should be France, Italy, Germany, England, Spain, Russia, United States of America, Canada and Australia. Our secondary market should be Thailand Malaysia, Singapore, Mauritius, Brazil, Mexico, Sri Lanka, India, etc. 3. Target market segments Our product is high tech product. Yet, it is an absolutely necessary product. Our Earth has become a global village, thereby increasing the importance of communication. It has become extremely important for people to communicate to their friends, relatives, etc living in other countries. Be it through social networking websites like facebook, orkut, etc or through phone calls and text messages. Outsourcing has further increased the importance of communications. Our world is shrinking not in the physical sense, but definitely in the virtual sense. As important is communication, so is security. Personal defence is a matter of great concern. Today many people, especially youngsters in the working group, are living alone in their apartments. These people who belong to the working group are getting increasingly concerned about their safety. Robbery is not an unusual thing today. People have therefore realized the need of security systems. As the USP of our product is Smartphone with patented JOLT™ Technology, our target should be people belonging to the following groups: 1. Upper middle class 2. Private entrepreneurs. 3. Small scale firms. 4. Home based workers. 4. Socio-demographic and lifestyle characteristics of target consumers. Today’s people are thinking people. They take advantage of every service possible if they think it is worth it. Our targeted customers are all belonging to upper middle class group. They are people who spend the money after considering all the aspects of the product. They are the working class. They have earned their money through hard work. Naturally, they are careful with their money. They take their time to decide and then invest in a particular product. They value their money and expect the companies to do the same. No matter which country the live, they think and then invest. The people in Western nations, that is, the Spaniards, Italians, French, Germans, English, etc live a high end life. They have the best of facilities and do not expect or accept anything but the best. So do the Americans, Canadians and Australians. They are not used to mediocrity. They want the perfect blend of style and performance. They want the best and they get the best. Hence there is so much competition in the markets. All the companies, big or small, are vying for the consumer’s attention. These also means that the customers get to choose from a wide variety of products. Their choices are unlimited. They get the best deals. Best designs and performances can only help us be a success in these markets. Comparatively, the Asian markets are little more broad minded. Of course they care about looks. But if a product scores a point less on the design meter but a point more on the performance meter, they will definitely go for it. There is a lot of poverty in the African continent. People are wary of spending their money on relatively new products. They will not buy products unless they think it is absolutely necessary. No matter how good the product, if they are not convinced of its utility, they will not buy it. There purchases are limited to work related stuff. Most people do have cell phones but they are very simple models and offer nothing except communication. Inspite of lifestyle differences, the only thing that matters to every market group is performance at its best. 5. Standardisation versus adaptation and differentiation of the product. To launch a product universally, the interests of the larger group are kept in mind while designing the product. Granted, certain sections of the world may be displeased by a particular feature. To avoid their negative comments, we can design the product in different ways. But by doing this we take an even bigger risk. Today everybody wants to be treated equally. Nobody wants any kind of discriminations. Differentiation of the product makes the people feel inferior. As for adaptation to the product, humans have a natural ability to adapt to any kind of situation or object. Only if we face objection from the government, we must develop a product according to their specifications and only for their particular country. However, there is a remote possibility of any such complications. Our product is not offensive in any way. Also we are targeting technologically advanced markets and consumers. Thus, our product should be kept STANDARD. This way we save the cost of production. Our advertising and marketing campaigns too, could be similar for the whole world. Thus, we are able to cut our costs effectively. Taking cue from the recently launched Apple’s IPAD and Amazon’s Kindle, I think it is best if we make available a standard product worldwide. Apple and Amazon banked on the concept of eBook reading. It created curiosity among the consumers and yielded amazing results for both the firms. We must bank on the combination of smartphone and security system. This will definitely guarantee us eyeballs 6. Pricing strategy and Recommended Retail Price (RRP) Let’s consider the approximate prices of iPhone 3G and Blackberry Pearl iPhone 3G £268.900 Blackberry Pearl £168.424 Considering that these products are just smartphones their prices are too exorbitant for the middle class. The security systems too cost anywhere between £100 to £500 When a person purchases iPhone and a security system, he altogether spends around £400 minimum. Therefore, our price should be less than that price to attract more customers. In my opinion, £350 as a starting price is affordable. If our product receives the expected favourable response, then in the fourth quarter we must raise the price to £400. This way we attract customers, earn their trust, build our reputation and maximize our profits. It makes more sense to climb from lower to higher than the other way around. The acceptance of the product is very important. If the price is too high, the consumers will not purchase it and we will incur losses. 7. Development of a Shocker® Smartphone range of accessories After the successful launch of the product, the next logical step is to keep on updating the product. iPhones, blackberry, nokia, etc have managed to stay in the market this long because the have banked in on the success. The updated their original version and brought out new products in the markets. They created a series of the same product Thus we should also update our range of products. After the first financial year, we must bring out another model which is more advanced than our previous product. Meanwhile after every quarter we must bring out at least one accessory. After first quarter we can bring out a range of headphones. These high tech headphones will ensure great audio in media player. After the second quarter, we launch a CD player that is attachable to our smartphone. This device will be used to play audio files which are in the CD through the medium of the smaartphone. After this, that is, after third quarter we launch a mini DVD player. People can watch the movies on their DVD on the smartphone screen. In this way we can avoid the process of transferring files to the phone and still enjoy it. 8. Marketing communication: advertising and promotion strategies As per our marketing budget we have £5.7 million reserved to advertise our product. In the first quarter, we will be launching our product in the capital nine markets, namely, France, Italy, Germany, England, Spain, Russia, United States of America, Canada and Australia. The European campaign budget of six countries collectively can be 3.7 million. The remaining the 2 million should be devoted to USA, Canada and Australia. As explained earlier, our greatest challenge is these three markets. Therefore, our campaign in these countries should be extensive. Today internet is best place. Anything and everything you require is attained from it. Therefore, one third of our budget should be used in online advertising. As we will be launching our own website and our advertising campaign at the same day which is a month prior to the release, we will be able to make our online campaign more effective We can also use social networking websites. Popular sites like Google, yahoo, msn, etc, too can be used effectively. Our remaining budget should be spent on advertising in newspapers, radios and television. We must use the reality shows to promote our products. We must use the means of mass communication extensively. We can also keep contests to garner publicity. We can keep the reward as our product at the price rate of £250. Our secondary market should be Thailand Malaysia, Singapore, Mauritius, Brazil, Mexico, Sri Lanka, India, etc. We will launch our product in these markets in the second quarter. As the initial buzz has already been created, we only need to take it further. Same strategies will be applied. Only the content of the advertisements will be changed. We will publicize the customers view. We can also create a space on our website for consumer feedback. This will improve our public relations. 9. Scale of production (unit volume: pre-launch period and first four quarters following launch for each market) Our production budget is 15 million. Our estimated production cost per unit is £150. If in the pre launch period, we manufacture 1000 units per market, then the total will be 9000 units. The total cost will be 13.5 million. Thus, we don’t overshoot the budget. Therefore, if we sell at £350 then we have £200 as profit per piece. If we sell 1000 products at the rate of £350 in each of our nine capital markets in the first quarter, we earn £31.5 million in the first quarter. Keeping aside the cost of distribution, marketing, etc we still make more than £10 million as profit. In the second quarter, we will launch in other markets. Following our strategy for primary markets, we will develop 1000 pieces per secondary market. As for our primary market, we will double the pieces manufactured. Thus, we would be producing more than 25000 pieces. The retail price will be the same in all the markets. Our sales will be around £87.5 million. In the third quarter, we will manufacture 2000 pieces for each market. The total pieces manufacture will be over 32000. The prices will remain the same. Our sales will be £112 million In the fourth quarter, the number of pieces manufactured in the third quarter will not change. However, we will increase the price to £400. Our sales will be more than £128 million. At then end of the financial year we will have earned more than £300 million and more than £100 million as profit. Our profit percent is around 45%. Thus we also manage to realize our objectives Works cited “French security agencies” www.wikipedia.org, N.d., Web: 13 May 2010 “iPhone 3G”, www.apple.com, N.d., Web:13 May 2010 “Blackberry pearl”, www.blackberry.com, N.d., Web: 13 May 2010 “German tech update”, www.german-way.com, N.d., Web: 13 May 2010 “Tech wired Australia”, www.techwiredau.com, N.d., Web: 13 May 2010 Read More