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Decision 3

CEO Thanh Minh Le

Abizar Attari
Karandeep Lamba
Piyush kaushik
Share Price Index and Its
SPI increased : $1325 in period 2 from $1000 in period 0.
Growth 0-1 : 11.54%
Growth 1-2 : 14.81%
Expected Growth 2-3 : because of the aggressive strategy
and a new brand launch but resistance from competition,
we expect SPI to grow by 16%.

Steady increase in the Net contribution from 32% of

period 0 to 48% in period 2. We expect a slightly higher
than a linear growth
GNP and Inflation is fairly stable over the years

Sonite market is a well established market and will continue to grow over the
next three years

All growth estimates for next period and 5 year period averages are more or
less accurate

Various research studies are more or less accurate with their statistics
We were short on price due to constant lost sales on product MOVE

Not focussed on one particular segment, and the interested target segment
for MOVE, the PROFFESSIONALS did not enough amount of product after
having enough purchase intentions.

New brand specific for SHOPPERS, matching the ideal chatacteristics of the
target segment.

Aggressive Strategy with high advertising budget.

Position our self as value for money for our competitors.

a) Production Calculated
Consumption in units of various segments for the next period, with their corresponding
purchase intentions = 511*15.4% + 351*13.2% + 304*0.3% + 191*6.2% + 217*.9% =
139,733 units
Considering the simulator having a tolerance of + - 20%, we chose 1,30,000 to avoid end

b) Price
Target segment is Savers who are price sensitive as well look for average performance
and convenience
Price of competitors such as SOFT,LOCK and TONE are having a lower price strategy
Hence, reduced price to $224 per unit.
c) Advertising
Increased -
Budget of $3000 on media to improve brand awareness and purchase intention
after analysing the competitors advertising strategies
Budget of $250 on research to 8% of total advertising to improve the message
communication quality.
d) Segmentation
100% to Savers. Single brand, single segment strategy.

e) Multidimensional Scaling
Economy : 10
Convenience : -5
Taking Reference from perceptual map, ideal value characteristics of the segments and
its evolution.
a) Production Calculation :
Similarly, 511*.2% + 351*3% + 304*17.6% + 191*11.6% +
217*14.4% = 118461 units, hence approx., 120,000 units.
b) Price :
)We dont want to fluctuate the price and confuse the target
customer - Professionals
)Hence we are sticking to the same price of $530 which is
comparable to competition price
c) Advertising :
Advertising media of $3500 to improve the brand awareness and while considering the strategy
of the market leader LOOP
Advertising research budget of $250 to improve the brand communication and message quality.

d) Segmentation :
100 % Professionals. Single Brand, single segment strategy!

e) Multidimensional scaling to improve segment characteristics :

Economy : -13
Convenience : 9
Taking Reference from perceptual map, ideal value characteristics and its evolution.
a) Production Calculation :
Target is : Shoppers
Next period estimated consumption by shoppers is 351,000 units.
Market leader LOCK with 15.9% should produce approx 56000 units,
since our brand will match all ideal values of shoppers and advertising
budget is 100% allotted to shoppers, hence we expect our sales to be
50000 units is approx. 14% of market share.
b) Price : $224 , comparing the competitor price for shoppers
segments like LOCK,SOFT, TONE. We have kept a low price strategy
to gain a strong foothold in the market.
c) Advertising : High advertising budget was allocated
since it was an aggressive new brand launch strategy.
d) Segmentation : 100% Shoppers, Single brand single
segment strategy!
e) Multidimensional scaling to improve segment
Economy : 11
Convenience : 3
Taking Reference from perceptual map, ideal value
characteristics and its evolution
Sales and Distribution Strategy
Sales Force
An estimate increase in number of units to be sold, due to increase in number of consumers and market growth for
sonite products
Allotted 50 new people to MODE brand since we are targeting shoppers distributed amongst channels as per their
shopping preference.
Increased the commercial team size to 50 each for MOST and MOVE brand because of the anticipated growth.

Distribution channels
we chose to distribute mainly through specialty stores and mass merchandisers for SHOPPERS as well as
SAVERS as they want price comparisons but average convenience and performance for MODE and MOST brands.
For MOVE we focus more on speciality stores.

Research studies
Research studies chosen were consumer survey, consumer panel, distribution panel, market forecast,
competitive advertising and competitive commercial team. These were chosen for the fact that we needed
consumer insights, brand awareness and purchase intention. we purchased competitive advertising and
competitive commercial team as we needed to know the strategy of our competitors in comparison to us and help
us make future strategies. Semantic studies was not purchased as we were to do product analysis at a later stage.

We purchased above reports for VODITE market also.

Profit and Loss Analysis
As from the graph we can see EBIT has increased at
a steady rate

and will be forecasted to increase by 50% to $36M on

account of sales from existing brand MOST and
MOVE and new brand MODE.
REVENUE (in thousands $)

Period 2 Period 1 Period 0

Revenues 51,759 44,730 36,292

> Period 2 growth in revenue reduced from 25% to 16% due

to long term strategy of investing in R&D of another brand
to be marketed to a separate segment.
Q : How Budget will help to achieve the objectives of
period 4?
High budget needed for investing in Vodite Market in
period 4 and required market studies.
Increase advertisement for brands, MOST and MOVE to
strengthen their position in the market and heavy
advertisement for the launch of new brand MODE.
Increase the number of Sales People for selling and
distribution of MOST and MOVE.
Hiring of 50 new commercial employees for the new brand
Thank You