Team 4 - Group Assignment - New Product Launch Plan

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Transcript of Team 4 - Group Assignment - New Product Launch Plan

  • NEW PRODUCT LAUNCH PLAN

    Team 4

    Sarah Lewis

    Kaylie Sautter

    Eva Lutter

  • OVERVIEW

    Answer crucial questions:

    What is our strategy?

    What do we want to achieve?

    What kind of demand do we want?

    How do we deal with competitors?

    How do customers react to our new product?

    Introduction of the new nozzle with customized spraying option

    Tactical/Strategic Decisions regarding the Marketing & Launch of our new product

  • STRATEGIC GIVENSDesired Level of New Product Innovativeness

    Pioneering Leveraged Creativity

    New nozzle, scents from lotions already in existence to develop a healthy, natural product line

    Desired Financial Results Achieve a 1st year gross sales of 35,000 units (105,000 units)

    Achieve a 1st year gross sales of $1.2mil ($3.6mil by 3rd year)

    Achieve a 1st year gross margin of $1.05mil ($3.15mil by the 3rd year)

    Market Share:

    67% in current mineral foundation market

    looking to gain at least a 15% fragrance market share from main competitors the first couple years

    Desired Market Entry Timing

    First-to-Market new product with the customizable spray nozzle

    Key Drivers of New Product Development

    Markets to serve: End-users, especially Women on-the-go, re-seller (Ulta & Sephora)

    Technology: Leverage new technology for nozzle while minimizing platform cost

    Competitive Stance of Positioning

    Direct Pursuit Grow market share by taking away from competitors, attack weakness of market share leader through customizable nozzle & lower retail price

  • STRATEGIC PLATFORM DECISIONS

    Type of Demand Sought: Product Improvement to existing market

    Launch plan must drive and achieve customer migration, encourage existing customers to migrate, and the competitors

    customers to switch to the new product

    Launch plan must also stimulate pro-active replacement demand

    Permanence in the market: We are here to stayif we meet our goals!

    Goal, metric, and time sensitive goals?

    Highly influenced by firms competitive capability

    Aggressiveness of the new product launch: Aggressive Entry

    Lots of attention through promotion & free testers early in the launch

    Competitive Advantage: Product will offer lower price AND differentiation

    Product Line Replacement: Dont have an existing product line BUT it will be something similar to a high-season switch

    Competitive Relationship: Making no reference to competitors

    Scope of Market Entry: Roll Out Very Rapidly, abbreviated Market Acceptance Testing

    Image: Modified Image including a new brand & a more customized experience for the end-user

  • MARKET ACCEPTANCE TESTING Sensorial analysis in order to identify the key drivers for our products acceptance includes use of the senses of smell, taste, sound, and touch

    trial of the product with focus groups

    observation of usage patterns & detection of individual differences

    reassurance of meeting customer expectations while also providing a customized experience

    Helps us understand the magnitude of changes that will get a particular consumer reaction

    Helps determine which popular lotion scents make the most promising fragrances

    Focus primarily on Beta Testing

  • SPRAY NOZZLE

  • TARGET MARKET DECISIONS(1ST STRATEGIC ACTION DECISION)Market Segmentation

    End use: Perfume for customer to smell better and seem more attractive to others

    Geographic & Demographic preferences

    Preferred by women Nationwide in the US. Demographically from 20-40 years old

    Upper level income

    Already a Bare Essentials customer

    Behavioral & Psychographic preferences

    The customer would already use makeup, more than likely use Bare Escentuals, and maintain her appearance with beauty products. She is concerned with how she is seen by others and their opinions of her. She always likes to smell nice.

    Benefit Segmentation (other market targets)

    Original Concept Generation

    The competitor gap of perfumes with makeup and beauty lines

    Method of Operation

    Once developed, this perfume will exceed original assumptions of the products use with its unique and functional spray design

    Concept Testing or Product Use Testing

    We found that changing the spray engineering would help differentiate our product more.

    Micro Market & Mass Customization

    Adaptive customizers: We developed the product to be customized by the customer. A customer can change the setting of their spray nozzle to suit their specific needs.

    Diffusion of Innovativeness

    Early Majority30% of the population roughlyInterested in keeping up with trends- Will adopt a new product after seeing it used successfully by either "innovators" and "early adopters" that they know personally. - Not big risk takers, only will after others do- Less affluent and less educated than innovators and early adopters

  • PRODUCT POSITIONING(2ND STRATEGIC ACTION DECISION)

    Product Positioning Statement

    Buyers in the target market should by Go Bare rather than others being offered because this perfume allows customers to customize it for themselves.

    Positioning to an Attribute (Feature/Attribute)

    Features a customizable spray adjustment. Customers can choose how much of the product they want to use.

    Position by Surrogate (Nonpareil)

    No other perfume asks the customer how much they want to spray, customers assume more than one spray is needed. Now, they get to choose.

    Campaign to Position Attribute

    Show a number of different women in different situations. Each woman saying a certain number. With the heading in the beginning that asks,

    Whats your number?

    Women saying or holding up fingers: Three Two or One

    Then shows our product, featuring the three different spray options and says

    You choose.

    Go Bare.

  • CREATING UNIQUE VALUE(3RD STRATEGIC ACTION DECISION)

    Branding Decisions

    You choose. Go Bare.

    Brand asks women to believe they can have a choice with their beauty products. Brand it as so and feature how they can customize their perfume usage with Go Bare.

    Packaging Decisions

    Keep the perfume in a clear glass bottle (primary package), then have the perfumer bottle in a clear plastic box (secondary package). We want to make it look bare as the name suggests. Nothing hidden, nothing but Bare.

    Pre and Post Sales Service

    Pre sales service includes informing retail and wholesale employees on the brand and product features, including how to demonstrate the three levels of spray function.Post sales would include an email asking the customer Whats your number? and if she liked the product. If any problems arise, they will be forwarded to customer service.

    Intangibles

    The feeling of being able to choose. That is a big benefit for the customer and is not seen in other perfumes. Makes the customer feel confident in her decisions

  • A-T-A-R ASSUMPTIONS

    Profits=Units Sold x Profit per Unit

    Units Sold = Number of buying Units = 5,000,000

    X A % of buying units who opt to try the product if they obtain it (15%)

    X T % of buying units who obtain Go Bare (if it is available) (5%)

    X A % of intended triers who can obtain Go Bare (30%)

    X R Measure of repeat: 1+ (the 25% of triers who like the product enough to repeat their purchase times 1 additional units bought by repeaters in a year)

    Units Sold = (5,000,000) x (.15) x (.05) x (.3) x (.25x1) = 2,813 units sold

    Profit per Unit = $39.95 - $4.15 = $30.05

    Therefore - Year 1 Profits = 2,815 x $30.05 = $84,530.65

  • What we will communicate to

    our re-seller

    What we will communicate to our end-

    user

    What the re-seller will

    communicate to the end-

    user

    COPY STRATEGY STATEMENTS

  • COPY STRATEGY STATEMENTSFor Ulta & Sephora

    Aligns with the natural elements of the makeup line, Bare Minerals

    Made with the same ingredients as our popular lotions

    Affordable price that also reflects quality

    Key Attributes

    Two sizes: normal and travel size

    Simple square bottle for easy storage and clean display

    Pre-measured nozzle for appropriate spritz

  • COPY STRATEGY STATEMENTSFor Women on-the-go

    Scent of favorite lotions can be applied with perfume without the hassle of lotions

    Made with natural ingredients from our most popular lotions

    Key Attributes

    Pre-measured nozzle for appropriate spritz

    Two sizes: normal and travel size

    Low cost that also reflects quality

    Easy pull to open top

    Simple clear glass, square bottle

  • COPY STRATEGY STATEMENTSFor the woman shopping at Ulta or Sephora

    Provides a new experience for the Bare Escentuals customer

    Perfume aligns with the natural elements found in the makeup line, Bare Minerals

    Emergence of Aromachology the use of fragrances for reduction of stress and change of moods

    Key Attributes

    Fresh scents that wont overwhelm

    Pre-measured nozzle for appropriate spritz

    Two sizes: normal and travel size

    Low cost that also reflects quality

  • TACTICAL LAUNCH DECISIONSThe Marketing Mix Communication Vehicle/Content Target Audience

    Pricing - Employ skim pricing- Initial buy incentives (price reduction)

    - Wholesalers & retailers- Retailers Only

    Distribution - Employ selective distribution - Wholesalers & retailers

    Public Relations - First to Market news release - Wholesalers & r