Final Project of Marketing

Launch the new product

Submitted to:

Sir Asim Ilyas

Submitted by:

Muhammad Saddam Sajid (08110059)

Muhammad Adeel Uppal (08110014)
Mudassar Umer (0508044)
Muhammad Zubair (08110039)

MBA (Fall 2008) and Bsc Accounting & Finance (Fall 2005)
GIFT University Gujranwala

Date: 2nd June 2009

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Launch the new product

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Acknowledgement

First of all, we thank to Allah Almighty to provide us

courage to complete this project. We also thank to
our honorable Professor Sir Asim Ilyas to provide us
opportunity to make the topic on such interesting
project.

Table of Contents

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Title no Particulars Page no

1 Profile of AB&C Company 5
2 Profile of SAMZ Company 6
3 Vision and Mission 7
4 Description of newly launched brand 8
5 Products 9
6 SWOT Analysis 10-11
7 Marketing Information System 12-13
8 Buying Decision making process 14
9 Market Segmentation 15-16
10 Branding 17
11 Product and Market Analysis 18
12 Pricing Strategy 19
13 Distribution Strategy 20
14 Promotion Strategy 21
15 Conclusion 22
16 Recommendations 23

Profile of the companies

AB&C Luggage Manufacturing Co., Ltd (Taiwan)

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AB&C luggage manufacturing company Taiwan is engaged in producing the luggage

suitcases. These suitcases are of different sizes and colours. By keeping in view the
requirements and purchasing power of all the customers AB&C luggage manufacturing
company produces the suitcases of all price ranges. They had the honor to produce all
types of luggage bags. AB&C luggage manufacturing company in order to maintain its
superiority in producing suitcases has introduced new models and varieties of suitcases. It
was the success of the company that they offer suitcases with the fundamental attributes
of good design, effectiveness and affordable price to the consumers.

AB&C luggage manufacturing company’s suitcases are also very popular the other
countries like Pakistan, Bangladesh, India, and the countries of Africa, Europe and
America. The objective is, to offer consumers suitcases of international quality at
affordable price and their demand is growing day by day.

Profile of the companies

SAMZ Luggage bags Manufacturers (Pakistan)

SAMZ luggage bags manufacturers is the one of the leading
luggage bags manufacturer in Pakistan. Since its formation,

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the company has always been contributing towards the advancement and development of
their products in Pakistan by introducing a range of luggage bags with affordable prices.
Their bags are checked by the intense quality inspection. They produce such luggage
bags with good material.

Moreover the company has skilled workers and management because due to their
coordination the company produces new and stylish bags. The company sales its bags all
over the Pakistan and export to other countries like Saudi Arab, Bangladesh, and
countries of Middle East. The company conducted continuous research on the production
of the new models of suitcases and sell it into the open market. The main objective is,
however, to offer consumers products of international quality at affordable price.

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Vision
“OUR VISON IS TO BE THE LEADER OF BEST QUALITY
AND COMFORTABLE SUITCASES PROVIDER IN THE MARKET”

Mission

“To make the recognition of our country and company in the global market

through our innovative and unique product, offered by us in economical price

considering the health and purchasing power of the consumers”

Description of the newly launched brand

SAMZ Company want to launch a suitcase with a new and ultra modern technology
called Blue ray technology. This technology is until now installed in the motor vehicles
and other tangible fixed assets used by the companies. For the first time this technology is
used in the luggage suitcases. Beside the cost of that suitcase, if that technology is
incorporated these types of suitcases, it will reduce the chance of theft.

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Blue ray technology is basically a chip of Blue ray costing Rs. 50,000. This chip is
inserted into suitcase and that suitcase is scanned through the satellite network all around
the world. The chance of theft is reduced when this type of technology is inserted into the
suitcases. These types of suitcases are purchased by those people who are traveled abroad
many times in a year. The name of this suitcase is SAMZ Tech Suitcase. The features of
this suitcase are given below:

• Good Quality Leather • Blue Ray Technology

• Durable • Sensor and Scanning

• Good quality • Attractive designs and colours

• Comfort • You can purchase only one or a

set (3 suitcases).
• Hand carry facility

Basically, this suitcase is very expensive to produce, so one company can not produce
this suitcase solely. So SAMZ Company signed a contractual agreement with AB&C
Luggage Company to produce these types of suitcases. AB&C Company will invest in
the blue ray chip technology and SAMZ Company will manufacture this bag in Pakistan
and inserted the chip in it. Moreover this chip is inserted in the suitcase that can not be
detachable but it is conveniently and easily scanned.

Products

SAMZ Company manufactures the following products:

• Suitcases (All sizes)

• Hand carries (All Sizes)
• Hand bags
• School bags

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• Luggage carriers
• Wallets
• Sleeping tents

SWOT Analysis

Strengths:
The main strengths of that suitcase are given below:
• Lighter wait.
• Brighter look.
• Easy identification all around the world.
• Made of colored molded rigid leather.

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• Available in various types and sizes and in different textures.

• Water proof.

Weaknesses:
The main weaknesses of that suitcase are given below:
• Price of that suitcase is very high.
• An ordinary passenger can not afford it.
• Unauthorized access
• Sniffing
• Gaining access to data on a cell phone.

Opportunities:
The main opportunities in that suitcase are given below:
• The Price should be decrease in order to deal the issue of affordability.
• The technology should be incorporated in the hand bags and valets.
• It can be manufactured according to the given specification by other companies in
Pakistan for promotion.
• There can be opportunity if it the blue ray chip is manufactured by the company
or in Pakistan to reduce the cost of import.

Threats:
The main threats in that suitcase are given below:
• Threat of copying the technology.
• Threat of low cost.
• Threat of new entrants in the market.
• Threat of environmental factors
• Threat of low demand due to economic instability.

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Marketing Information System

The marketing information about the suitcase is collected through the following three
sources:

• Internal records:

Both the companies that are indulged in the manufacturing of the suitcase maintain an
internal record for manufacturing, pricing, positioning, and promotion of that suitcase.

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However, this information often remains under-utilized because it is based upon the
theoretical assumptions and these assumptions are rarely cope with the practical scenario,
either in the form of an individual entrepreneur or in the functional departments of larger
businesses.

The internal record data includes financial, production, labor, marketing, capital and
logistical data. The main issue is the holding of data, so that this information is not leaked
to the peoples outside the organization. The internal records of both AB&C Company and
SAMZ Company include the sales and raw material invoices along with few internal
records that can be used by marketing managers.

• Marketing Intelligence:

A marketing intelligence system is a set of procedures and data sources used by

marketing managers to sift information from the environment that they can use in their
decision making. Both AB&C Company and SAMZ Company set different types of
procedures and sources from where they get the data about their competitors.

Like every company SAMZ company also maintain the system for collecting the
information about the competitors and their environment. This system is working
continuously and helps the company to add the new features in the current products. The
SAMZ Tech suitcase is a living example of the efficient working of the marketing
intelligence system.

Basically this type of system is used by the senior management of the company or the
owners of SAMZ Company to study the current market trends. The working of that
system includes the study of newspapers, trade magazines, business journals and reports,
economic forecasts and other media. Therefore it is shown that this system is working on
the secondary data. This data can also be gathered from producers, suppliers and
customers, as well as to competitors.

• Marketing Research:

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For the making of SAMZ Tech suitcase the marketing department of SAMZ Company
conducted a marketing research in which they are perform different activities that are
given below:

 Making a questioner about the demanding features of suitcase.

 Filling the above questioner from tourists, travelers, people belong to elite class, and
other social classes {up to some extent}.

 Put the data into research software along with secondary data and conclude the
attributes or features that SAMZ Company provides or offered in the SAMZ Tech.

 The final decision is to make the SAMZ Tech suitcase on the basis of the information
gathered.

Buying decision making process

In order to sale the SAMZ Tech suitcase, the management of SAMZ Company argued
that there are two different types of buying behavior shown the consumers that are given
below:

• High involvement purchasers:

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These are the individual consumers that purchase that suitcase. They might be purchase a
single bag or a set according to their needs. The individual customers are the main
customers of buying the suitcase. As you know the cost of this suitcase is very high so
that it is affordable to the high elite class people. These customers of this bag includes the
people belong to elite class, travelers, and foreigners etc. the company also target the
people of other social classes by reducing the cost in the near future.

• Low involvement purchasers:

These are the business customers. As we explained earlier that SAMZ Tech suitcase is a
newly launched product of SAMZ Company. So the company did not want to share this
technology to the other businesses at this time. This type of purchases is very low.
Moreover there might be an opportunity that SAMZ Company will share that technology
with the other Pakistani company.

Complex Buying Behavior

In the case of SAMZ Tech suitcase, the buying behavior of the consumers is Complex
buying behavior. It occurs when the consumer is highly involved with the purchase and
when there are significant differences between brands. This behavior is also applicable on
the purchasing of SAMZ Tech suitcase.

This buying behavior is complex because the risk is high (significant financial
commitment), and there is a large differences among brands or products that’s why the
consumer purchase these types of suitcases rarely.

Market Segmentation

Market segmentation is the process of dividing markets comprising the heterogeneous

needs of many consumers into smaller parts or segments comprising the homogeneous
needs of smaller groups of consumers. There are four basis upon which the marketing
department of SAMZ Company creates segments that are given below:

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• Geographic Segmentation
• Demographic Segmentation
• Psychographic Segmentation
• Behavioral Segmentation

The SAMZ Tech suitcase serves approximately all the segments of the markets. The
detail of the serving each segment is given below:

• Geographic Segmentation

The geographic segmentation represents the market divided by location. The SAMZ
Tech suitcase is very costly and the company firstly targets the people belonging to elite
class. The concentration of these people is living in the big cities like Islamabad, Lahore,
and Karachi etc. Moreover all the persons which afford that type of luxurious suitcase
also residing in these cities. So the people in these areas share some similar needs and
wants and these needs and wants are different from the people who are living in the small
cities of the country.

• Demographic Segmentation

In the demographic segmentation, the population is divided into age, gender, income, and
family lifecycle amongst other variables. For the suitcase industry this segmentation does
not exists.

• Psychographic Segmentation
In Psychographic segmentation, the market can be broken down according to lifestyle,
social class, and personality characteristics. This segment holds strongly in the sales of
SAMZ Tech suitcase because the persons who have a modern lifestyle, belongs to elite
class afford these types of luxurious suitcases.

• Behavioral Segmentation

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In Behavioral segmentation, the market is broken down according to the benefits, usage,
and on occasion that a consumer seeks from purchasing a product. The SAMZ Tech
suitcase is bought by the people occasionally because it gives them benefits.

Competitors:
SAMZ Company used this technology first time. But the other companies like Nike,
Addidas, etc may also launch this type of suitcases in order to compete it.

Branding

The features of SAMZ Tech (which is also a brand name) suitcases are given below:

• Good Quality Leather • Good quality

• Durable • Comfort

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• Hand carry facility

• Blue Ray Technology

• Sensor and Scanning

• Attractive designs and colours

• You can purchase only one or a

set (3 suitcases).

• Lighter wait.
• Brighter look.
• Easy identification all around the
world.
• Made of colored molded rigid
leather.
• Available in various types and
sizes and in different textures.
• Water proof.

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In near future, SAMZ Company will also launch this technology in the hand bags for
females and valets.

The Product Life Cycle (PLC) is based upon the life cycle of the product. It has four
different stages which are given below:

• Introduction

• Growth

• Maturity

• Decline

SAMZ Tech suitcases are in the introductory phase of the Product life cycle because the
other phases depend upon the buying behavior and feedback of the consumer.

Product and Market Analysis

The marketing department of SAMZ Company conducts a product and Market Analysis
before launching the SAMZ Tech suitcases. This analysis includes the following
fundamental requirements:

• First of all the market department of SAMZ Company Analyze the critical success
factors in order to ensure that they are ready to compete and the suitcase they
produce is of good quality and gain the good market share.

• Second step in that analysis is the Customer identification and profiling. In this
step the marketing department of SAMZ Company finds the place where it
launches its product in order to get maximum profitability. This can be done by
forecasting the sales.

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• Third step is the evaluation of technology, sales, existing products/services,

distribution, product development and other trends affecting the market of the
SAZM Tech suitcases in future.

• Fourth step is the identification of partners/distributors or other facilitators to

assist the progress of the company. A company can not sale their products solely.
It needs a partner or distributor for sale. So SAMZ Company practiced the same
thing.

• At the end SAMZ Company identifies its competitors, and done the continuous
research on the new product development or to make its market expand.

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Pricing Strategy

It is the strategy of establish a high price for a new product. A skimming strategy is
adopted by the SAMZ Company because they launch a new kind of suitcases that
contains the new technology and the demand of those suitcases is uncertain. The
company wanted to take the maximum price from the targeted customers. In near future
if the SAMZ Company faces the competition, then it made the new and similar products
but the market for this product is expected to mature very slowly.

• The SAMZ Company holding the monopoly in Pakistan because there is no

competitor that made this type of suitcase.

• As the price of SAMZ Company’s product is very high, so that the elite class is
the main target of their suitcases. This high price strategy (Price skimming
strategy) will support the indented positioning.

• If the SAMZ Company started to produce the tracker chips itself, then the cost
and ultimately the price of the SAMZ Tech suitcase will change.

• As the raw material for SAMZ Tech suitcase is very costly, so the price of that
suitcase is strongly related to the cost of production.

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Distribution Strategy

• The company has various outlets or franchises through the country in which these
suitcases are available. As SAMZ Tech suitcases are very costly so the company
sells it on their authorized outlets and franchises.

• The SAMZ Company, when selecting the dealer for the franchise, firstly they
conducted a detailed interview supporting with references. If the interview
successful and the references are valid then the persons as a dealer.

• The key terms of contract with the dealers and the channel members are given
below:
 Work with loyalty
 Provide the better services to the customers and handle the Customers
Complaints
 Maintaining the work environment

• Special Transport vehicles are used to deliver the suitcases to the authorize
dealers and franchises.
• Our authorize dealers are located in the following cities
 Karachi
 Lahore
 Islamabad
 Sialkot
 Faisalabad
 And launching soon in other cities
• SAMZ Company is responsible for the loss or damage for during transit

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Promotion strategy

• The tools used for promoting the SAMZ Tech suitcase are
 Advertisement on newspapers and bills broad
 Direct marketing
 Broachers
 TV and Internet
• Our targeting consumers are elite class but the SAMZ Company planning to
launch for other social classes by reducing cost.
• The upcoming models of SAMZ’s suitcases are
 SAMZ ultra tech-I
 SAMZ ultra tech-II
• The advertisement of these suitcases is broadcasting on Television Channels.
• This will enhances the promotion of the

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Conclusion
In Pakistan, we are introducing a very latest and advance technology first time. Having a
pricing strategy in our mind initially we are charging high prices from our targeted
customers who are willing to pay us. But in future to increase the market share and our
number of buyers, we will adopt a new pricing strategy to sell our products and we also
bring new innovations in a existing technology and we will open our outlets in other
major cities.

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Recommendations
Being a Head of SAMZ Company, we have following suggestions:
1. We launch and promote the product through campaigns, advertisements and
documentaries.
2. We will sell our product not only in the new markets but also in existing markets.
3. We should give the awareness to both targeted and potential customers.
4. We should reduce the cost, in this way we can reduce the prices.
5. We should capture not only Pakistani market but also to the foreign markets.
6. Through having the knowledge of strategies adopted by our competitors.
7. Right marketing for the right segmentation.
8. Taking the complains and suggestions of our customers through calls and internet.
9. Giving the extra benefits to our customers.
10. We will give the assistant in case of any failure in the working of machinery

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