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R&R CASE

STUDY
ANALYSIS
I. IDENTIFY AND DEFINE THE
PROBLEM
The major barriers and risks that Reiss had to overcome were:
 Minimal focus on mass-scale advertising and creating a brand image
 Competitors already selling Trivia games
 Finance to start the business
 A high risk that the interest in Trivia games would die down soon if new variants weren’t
launched
 Formulating 6000 questions by himself
 TV Guide opted to be only the licensor
 starting up a venture with low cost initially was a challenge
 Educating Venture Capitalists about the deal was a barrier in itself
 there was a high risk to create a trivia category that Trivia Pursuit didn’t cover
II. GATHER INFORMATION

• Bob Reiss was well aware of the trend in the gaming industry and the potential which
he could cater to. He realized that there was a demand for trivia games and that there
was insufficient capacity to meet the demand to meet the upcoming season. With the
video and computer games loosing popularity, he looked for a short-term potential
that would be covered in a one year window of opportunity. He conceptualized the
idea from one product market “Trivial Pursuit” and followed the trend to develop Trivia
Inc. The success of Trivial Pursuit in the Canadian market was a major factor that
created the opportunity as from his years of experience in selling games in US, sales
here approximate 10 times of sales in Canada. This wide spread crowd he estimated
would eventually create interest in Trivia games and build up the entire venture.
Television being the source of idea he was sure to capture a significantly large market
for his product as an average American family would watch over 7 hours of television
per day.
III. GIVE ALTERNATIVE/S
• Two-tiered approach for advertising – Reiss distinguished between the mass
merchandisers and the Department/gift stores. The strategy was to quickly sell to
upscale retailers who would establish a full retail-mark-up which were usually
department stores. Reiss employed two different sets of reps for these channels.
Cooperative ads were a powerful attraction for different buyers and the stores would be
asked for minimum purchase orders instead of being charged for ads with their names in
it.
• Teaming up with Kaplan – Reiss used his strong network to seek help from Kaplan who
was his long-time friend and teaming up with him to secure a line of credit from him to
purchase supplies for initial run. Kaplan would work on production and shipping with
Reiss focus on marketing and selling the game.
• TV Guides association – Reiss was able to convince TV Guide to be a licensor
and gave a contract to manufacture the game. Since TV Guide was the
magazine which specialized in television coverage and was popular amongst
the households in US, a strategic alliance with them in this form was positive
for Reiss. He was also at ease preparing 6000 questions for the game as TV
guides management insisted their employees develop each question for
which they would be paid. In this way Reiss could focus on other
developments of the venture.
• Cost Reduction – He employed various methodologies to reduce cost, firstly,
the questions and answers were printed in books rather than cards. Through
Kaplan’s connections, they were able to find good suppliers. Also their Just in
Time concept and customized computer program helped them decrease their
estimated costs by 30 %.
IV. SELECT BEST ALTERNATIVE/S

• Two-tiered approach for advertising


• Teaming up with
• TV Guides association
• Cost Reduction
V. SOLUTION

• One big obstacle that had to be overcome was developing the 6,000 questions. Alone, Bob
Reiss would never be able to come over this obstacle the time required for making them is
too great. Bob Reiss was able to overcome this by paying TV Guide's employees to create
them. Without this partnership, the TV show would have never been successful. Another
obstacle he had to overcome was raising the funds for the show. Raising $350,000 is not an
easy task and it was a struggle for him to find a way to raise his funds. In order to overcome
this struggle, Reis decided to reach out to Sam Kaplan with an entrepreneurship idea of
starting Trivia Inc. Reis and Kaplan would share ownership of the company and it would give
Reis the funds he needed to run the show.
VI. RECOMMENDATION

• I think Reiss should follow through with his idea for "WHOOZIT?". This
game seems like it would be easy to play as recognizing famous people
would be a familiar topic to most of the public. Reis said that if he created
WHOOZIT, by giving the player several chances it would make the game
most more beginner friendly and enjoyable. As long as he would be able
to keep the production costs low as he did with TV Guide, I think it would
be a profitable endeavor. Reiss should Convert fixed costs into variable
costs! Critical when resources are lacking.
VII. SWOT ANALYSIS
STRENGTHS
Reiss set up a game manufacturing and ran it for that company, building a sales of
$12,000,000 in the three years.
He was able to gain an excellent understanding of the market and by 1959 could start
on
his own as an independent manufacturer representative in the same industry.
The largest one, toy „R‟Us for example, hag a 14%share of the entire market in 1984
and
the success of the product was based on less than dozen Retailers.
Trivial pursuit in Canada spilled over to the US the large games companies would
eventually produce and market their own similar products.
In 1983, sales were exceptionally strong, especially for the product that had been
promoted through WOM. (word of mouth)
Reiss discussed theme idea with his some closest friends in the manufactured
representative business he realized that he could add strength and interest in his project
by team up with the publishers of TV Guide magazine.
The magazine in which the Add of trivia games was publishing was approaches to 18
million copies sold per week.
Reiss know it very well because he did a job in stationary industry and most of the
market owners and store keepers knew him very well.
He communicated with the T.V guide magazine authorities and with venture capitalist
Kaplan on 50% royalty on per game sold and he even convinced them on his idea.
WEAKNESSES

Lack of advertising budget that was $1 million for their own Trivia games.
Reiss estimated that for the first production line he needs $300,000. Sam Kaplan had a
sizeable personal net worth, he lend his line of credit to purchase supplies for the initial
production.
He was not able to approach the advertising budget of the large manufacturers which was
surpass $1 million for the trivia games.
He started independent business in the market if he started it by doing partnership with
the other than their business will be on boom.
For this purpose they used Heller Factoring to check the credits, guarantee
payment,
collect the money and pay Trivia Inc., all for a fee of 1% over sales.
Due to lake of finance he didn‟t do his advertising campaign completely.
They were not expanding their product line for the competition in the market.
Reiss cannot develop trivia game technically so he hired a professional on 5%
to 3%
royalty on per game sold.
Lack of target marketing was also the biggest factor Lack of target marketing
was also the biggest factor
OPPORTUNITIES
They should develop the Sustainable Competitive Advantage in the existing products.
Price was very high in the market because if another person lunch the same product
within the market with the minimum price they would had competitive edge.
Reiss sold his representative business in to a small American stock exchange company in
1973.
The smaller stores carrying the game would be very difficult to collect the money
For the collecting of money they used Heller Factoring to check the credits, guarantee
payment, collect the money and pay Trivia Inc., all for a fee of 1% over sales.
In 1983, Reiss got the point that the interest of people in those days were diverting
towards the trivial games rapidly and there was not any big competitor of trivia game so
Reiss got the opportunity to design a game and to get success.
THREATS

A very large manufacturer was becoming dominant in the industry because they could
afford very expensive advertising campaign their retailer demanded product that they
purchased.
When the only Trivial game was in the market in September 1983, two small firms had
announced to enter in the market next year and taking order.
VIII. ANSWER THE CASE QUESTION/S