Week II Assignment 1 Running head: WEEK II ASSIGNMENT

Week II Assignment Suroor ul hasan Syed Mohammed Student ID: F00305131 Master of Business Administration AL366 - Marketing Management Instructor: Sandra Jahns Concordia University Wisconsin March 23 2013

Week II Assignment 2 Objectives: How many people will buy my product? 1. Mobile phone market segments 2. Demographics of the market segments 3. Consumers for my product in the demographics 4. Competition in mobile phone device market and their market share 5. How my product is better than competitor 6. Using the competitive advantage 7. Conclusion

Week II Assignment 3 Market segment and demographics of market segments: There was a survey conducted by Pew Internet and American life project conducted in between August 7 to September 6 0f 2012, Total number of people in survey were 3,014. Telephonic calls were made and interviews were conducted in both Spanish and English. The margin of error was +/- 2% points.(1)

According to the survey results: Gender: 46% of men and 45% women use smart phones where the large number of 55% people still does not use smart phones.

Age: 66% of 18 to 29 years old, 59% of 30 to 49 years, 34% of 50 to 64 years and 11% of 65 years old. This shows that the use of the smart phones is more in the younger generations and less in older people. The use is decreasing with the age of the people.

Race: 42% of white, 47% black and 49% Hispanic uses smart phones. The use of smart phones is lesser in white people compared to people with other ethnicity.

Income: 35% of the people with less than $30,000/yr., 42% of people with $30,000 to $49,000/yr., 56% of people with $50,000 to $74,999/yr., and 68% of people with above $75,000/yr. income. This is an important analysis for the sale of our product. People with higher income can afford the smart phones but people who are driven by the benefits of the smart phones even with low income uses it but a very less percentage turns up. Our phone is an

Week II Assignment 4 economic smart phone with the qualities of the expensive smart phones so this analysis gives a ray of hope for the sales of our product.7

Educational level: 21% of people with no high school diploma, 36% of high school grads, 50% of college grads and 61 % of college grads use the smart phones. The use of smart phones is increased with the educational level. People who are well educated finds it useful but less educated people also does that. If we find a way to show it helpful to the people with less education that will be a new door to improve the sales.

Geographic location: 48% urban people, 49% of suburban people and 29% rural people use smart phones. Rural people can make use of the internet for the weather conditions, and additions of some informative and helpful applications such as do it yourself kind of applications that can help in bringing health awareness, troubleshooting electronic and electrical devices, cars etc. will be extremely helpful in increasing the sale.

The helpful facts in the survey were: In one year the smart phone users increased from 35% to 45%, 15% still does not use mobile phone at all and about 55% does not use a smart phone which was 35% last year and growing at the linear pace.

Consumers fit in the demographics: Smart phones users and non-users. In these demographics we have planned separate strategy to different type of the people

Week II Assignment 5 For young people: Lesser price for a smart phone with better characteristics People from age 50 and above: For attracting this set of consumers, we will install certain applications that provide health awareness, troubleshooting heart attack when alone, healthy eating habits, yoga and cardio exercises etc. For people with less income the cheaper smart phone will be a drive to buy one. For school going people: A dictionary application will help Rural people use the mobile phones but as the smart phone use is only 29%. Generally rural people live remote to many services such as hospitals, bars and clubs, shopping malls etc. Marketing the device with certain applications for the ease of music download, online shopping can be very beneficial.

Competition: Competition is very furious in this field as the market is flooded with the companies. Because some companies offering the service along with devices such as AT&T, T-Mobile, Verizon, Sprint etc. Besides, the cell phone device sold in the market without the service (unlocked phones). The direct competition will be with the companies offering the devices without service.

Major competitors and how my product is better (2) 1. Blackberry RIM Curve: 13% Market share Available at a low price of $79.99 but with 2 year contract with Sprint. It has a qwerty key pad and with limited blackberry applications. But, our device is without any contract and equipped with latest applications.

Week II Assignment 6 2. Apple iPhone 2: 8.3% Market share Apple phones come exclusively with AT&T, and also an expensive device comes at $700 off the contract.

3. Blackberry RIM Storm: 7.6% market share It comes with qwerty key pad and with limited blackberry applications and a contract with AT&T. Our device comes at a very low price of $200 off the contract

4. LG Voyager: 7.0% market share It also comes with the contract and off the contract its price is $450, while our product is just $200.

5. LG Dare: 6.7% market share LG dare is comes with Sprint, There is no flexibility in using the service with Sprint because it is CDMA and even after the contract end, the services with SIM card cannot be used.

As per the competition, our product is better than and any other competitor. It can assure the easy penetration in the market and good acceptance. Because, our product has all the qualities of a good quality smart phone that any consumer look for, such as LED display, 35 hour battery standby time, built in very useful applications, something that person with any age adore, it is off the contract which ensure the freedom to choose the best suitable service plan available in the market. If someone takes a service off the contract the monthly bill can be around $70 to $100 for about 2 years. The two year spending during the contract will be about $1700 to $2500. But

Week II Assignment 7 off the contract it will be $30 to $50/month which is $700 to $1200 for 2 years. If they choose our phone he will save more than $500 every year for the similar services and a better smart phone. So, we can expect at least 2% market share in the first month and up to 8% in first year.

Conclusion:

According to the survey conducted by IBM Institute(3), the comparison of the customer preference about the service provider reveals that 78% of customers prefer the service provider based upon the wide set of offerings, and only 22% prefer for few focused offerings. In this case they compromise either on the device or on the price. So, we offer a cheap device and they need not compromise on device and also price. Only 15% people choose one service because of the device, it means that they desperately want the service so the compromise on device is going on. Hence, by following the strategy with the above mentioned default applications and marketing the economy and elegance together will bring the success.

Week II Assignment 8 References: 1. Pew Internet & American Life Project (2013) Smartphone Ownership Update http://www.pewinternet.org/Reports/2012/Smartphone-Update-Sept-2012/Findings.aspx

2. Bloomberg (2013) Top-Selling U.S. Cell Phone http://images.businessweek.com/ss/09/02/0204_cellphones/1.htm

3. IBM http://www-05.ibm.com/de/media/downloads/go-mobile-grow.pdf