Case Challenge TeamDecoders

Case ChallengeTeam Name: DCoders

Business Problem

• CD Arena is a Movie CD Rental Shop, started 2 months back

• Rents out movie CDs of different genres in Hindi and English under• Gold and Silver packages

• Till now Rs 30000 have been spent and business is incurring losses

• Competition is tough and no loyal customers are there

• Customers acquisition seems to be costly

Executive Summary

Strategic objectives

Insights

Analysis

Recommendations

To find out the revenue of the company.

To Find out a solution to make company profitable.

To which particular areas and genres company should focus.

Marketing strategies to boost its revenue and generate profits.

Revenue Assessment Pricing Analysis Portfolio Analysis

Marketing Strategy

1.Measuring Revenue2. CBA Analysis on various product segment

1. Socio Demographic Customer Segmentation.

2. Non Linear Pricing Model.3. Bundling Model

Drilldown Analysis1. Association Analysis.2. Seasonality Analysis.

3. Sales Promotion

1. Revenue in Feb reduced by 17 %.

2. 4 genres have profitability less than 80%

48% of revenue is received by two genres

Focus should be more on Action and Drama genre of other actors for inclusion.

Analysis shows that 10 people bought Action and Drama CD’s together.

• Non Linear Pricing model- Helps customer to have long term association with the outlet.

• Bundling with genres like ACTION and Drama can increase the revenue earned on them.

• Sales promotion via pamphlets and Email can be done on Thursdays.


Marketing Strategy

Measuring RevenueSummary

Total Revenue earned from Enrolment Rs. 5,150.00

Total Revenue earned from Transaction

Rs. 4,880.00

Total Revenue Rs. 10,030.00

Fixed Cost Rs. 25,000.00

Cd's cost Rs. 5,000.00

Total cost Rs. 30,000.00

Total Loss Rs. 19,970.00

ASSUMTIONSEg If issue date is 16/02/2014 and return day is 17/02/2014. No Of Days is considerd as 1.Eg. If a person is enrolled on 16/01/2014 then he is considered as enrolled till 16/02/2014

Revenue in February is reduced by 17 percent.

Genres Count Of CD's Revenue Generated Cost CBMystery 1 100 120 120%

Crime 4 400 460 115%Action 19 1900 2170 114%

Adventure 3 300 300 100%Drama 14 1400 1360 97%

Comedy 5 500 430 86%Fantasy 1 100 40 40%Musical 1 100 0 0%

Romance 1 100 0 0%Animation 1 100 0 0%

Cost Benefit Analysis of various genres


Marketing Strategy

Customer Segmentation

Socio-Demographic ConsumerSegmentation

Male

Female

Young Male not at work ~14.5%

Young Female not at work ~ 8.7%

Married/Unmarried Male at work

~14.5%

Married/Unmarried Female at work ~

23.1%

Parents at work ~24.64%

Parents at work ~14.5%

24 Y 32 Y

1 2 3


Marketing Strategy

ActionAdventure

ComedyCrime

DramaFantasy

Mystery

0

2

4

6

8

10

12

14

1-Male

2-Male

3-Male

1-Female

2-Female

3-Female

Segment wise genres affi nity

1-Male 2-Male 3-Male 1-Female 2-Female 3-Female

Here 1-Male means :- Young male (Age <24). Refer Previous Slide

1. 48% of revenue is received by two genres i.e. 2-Female (24Y-32Y) and 3-Male (>32Y).

2. ACTION genre is the most favorite of all.

3. It seems that working women has affinity towards Action and Drama.

4. It seems that married men has affinity towards Action and Comedy.

5. Fantasy and Mystery are the most less affiliated genres.


Marketing Strategy

Non linear Pricing Model

Problem

• ZERO Customer turn back after one month of membership.• Only 6 Customer visited more than once to rent new video

CD.

Impact

• Due to fierce completion customer acquisition cost is more.• Brand establishment takes a longer time.• Lack of loyal customer makes business a risky proposition.

Solutions

• Non Linear Pricing model- Helps customer to have long term association with the outlet.

Gold SilverMonthly 100 50Quaterly 250 125

Half - Yearly450 225

Yearly 800 400

Enrollment Charges

LanguageRent/day

(silver)Rent/day

(gold)Rent/day

(silver)Rent/day

(gold)Rent/day

(silver)Rent/day

(gold)Rent/day

(silver)Rent/day

(gold)English 40 30 40 30 35 25 35 20Hindi 30 20 30 20 25 15 20 10

Day 1 Day 2 Day 3 Day 4 Onwards

Rent Charges


Marketing Strategy

Bundling Model

Problem

• Musical, Romance and Animation movies had ZERO Demand.• Fantasy genres was less demanded.

Impact

• 10% Space was occupied by the SKUs which were not rented ever.

• 18% of the total cost was incurred in fetching these products.

Solutions

• Bundling with genres like ACTION and Drama can increase the revenue earned on them.

English Silver GoldAction + Mistery 75 55Action + Fantacy 75 55HindiDrama + Crime 55 35Action + Crime 55 35

Super Saver Silver GoldHindi-Crime 25 15

English-Fantacy 35 25

Bundle Offers


Marketing Strategy

Movies / Genres to include or exclude

Star Cast of movie Genre of movie

Percentage of movies remained unrented

LDC Action 100.00%

Matthew Broderick Animation 100.00%

Ranbir Kapoor Musical 100.00%

Salman Khan Comedy 100.00%

Salman Khan Romance 100.00%

SRK Action 100.00%

Aamir Drama 50.00%

Following genres must be avoided as it had 0 customer demand and remained 100% unrented

· Animation-English· Musical- Hindi· Romance- Hindi

Actor wise recommendations for exclusion:

INCLUSION Focus should be more on Action and

Drama genre of other actors for inclusion.

Comedy and Crime genre can also be considered for inclusion according to the data.


Marketing Strategy

Strength:56.57% of the customers are youth(<30 Years of age)Almost equal response from male as well as female customersA large range of genres available

Weakness:Not able to increase customer baseNo loyal customers yetSome genres are not picked by the customersBusiness incurring losses.

Opportunity:Doing something different from the competition may fetch more customersTwo months are too less to judge the performance

Threats:Tough competitionNo sure shot guarantee of profits in near future

Product:Need to check which genres are in demandWork for those whose demand is lessBundling of fast moving genres with less moving genresPrice:Pricing needs to be revised for rentals as well as enrolment so as to attract more customers

Place:Placing different combination of genres/movies at the display at shop

Promotion:Referral discounts and gift vouchers.Sales promotion by posters in local dailiesFeedback system via emails or phone calls

SWOT and 4Ps


Marketing Strategy

Association Analysis

ActionAdventureComedy Crime Drama Fantasy MysteryAction 2 2 3 10

Adventure 2 1 1Comedy 2 1 1

Crime 3Drama 10 1 1 1

Fantasy 1Mystery

Association analysis shows that 10 people boughtAction and Drama CD’s together.

Association can be seen among :-Action-DramaAction-CrimeAction-ComedyComedy-Drama

Proposed Display of CD’s Rack

Action Movies

Drama Movies

Crime Movies

Comedy Movies


Marketing Strategy

Seasonality Analysis

No of enrolment is highest on FRIDAYS-Suggestions :- Sales promotion via pamphlets and Email can be done on Thursdays.

Revenue earned is maximum on WEDNESDAYS & FRIDAYS-Suggestions :- Happy hours promotional activity can be done on Mondays and Tuesdays to attract customers.


Marketing Strategy

Sales Promotions

Case Challenge TeamDecoders

Documents

Transcript of Case Challenge TeamDecoders