5. TEAM L-SPI
1493
1290 1362 1380
1320 1383 1425
1151
1000
Period Period
0 Period Period
1 2 Period Period
3 4 Period
5 Period
6 Period
7
8
5
6. • SPI:1151 2 products – Lock & Loop
• Earning before Taxes: 18456 Loop($500) – Target Professionals
• Advertising: 4916K$ Lock($250) -- Target Savers
Period 1 • Commercial Team Cost: 1332$
• SPI:1290 Invested in LOSH– A product for Shoppers
• Earning before Taxes:23476
• Advertising: 4080K$
• Commercial Team Cost: 1290K$ Made our first mistake!!
Period2 • R&D : 1250
Analysis &
•SPI:1362
•Earning before Taxes:23534
Launched LOSH -$240
Invested in LOHA – A product for High Earners
Strategies
•Advertising : 5640K$ Loop -$485
•Commercial Team Cost: 1921$ Lock - $210 Reduced Price
Period3 •R&D: 1110 Price Race on
• SPI: 1380 LOHA launched- $500
• Earning before Taxes:20285 Loop- $435
• Advertising: 5649K$ Lock - $195
• Commercial Team Cost: 2796K$ Losh - $230 – Focus on one product
Period 4 • R&D : 2945 Invested in LELI – Our Vodite planned for period 6
6
7. •SPI-1493 Lock starts sinking!
•Earnings-$28225K Invested in LELI
•Advertising:6267 Frantic increase in commercial team size
•Commercial Team:4001
Period 5 Losh doing well
•SPI- 1320 Budget hit!
•Earnings-$22472K Modification of Lock
•Advertising:6684 Had to hold back on decision to launch Vodite
•Commercial Team:4350
Period 6
Analysis &
•SPI- 1383
•Earnings- -$16437K
Launched LELI -$995
Modified Loop picks up sales
Strategies
•Advertising:15374 Loop & Loha not doing well
•Commercial Team :6011
Period 7 Investment in LOOT- Targeted at the growing shoppers segment
•SPI- 1425 Launched another vodite LELO
•Earnings- -$18139K Launched Loot
•Advertising:16728 Losh is the saving grace
•Commercial Team :6661
Period 8
7
8. What We Did??
• Poor commercial team size initially
• In period 3, didn’t know how to use the
loan sanctioned
Mistakes • In period 4, price of Loop was reduced
drastically- Professionals are not price
sensitive.
• Budget too little for so many products
• Focused on developing a product for
every segment
• Decision to focus on our prime product
(Losh) pays off
Positives • Decision to modify Lock and take
advantage of its brand awareness
works
• SPI dips only in one period (6th), growth
in every other period
8
9. The first thought that
strikes you is the
Create demand for
Commercial Teams first thought that
your products and
are as crucial as Always think of 2-3 strikes your
fulfill them too. In our
Have one product for advertizing spend. periods ahead. competitor too. That
case, our
ONLY one segment. Demand creation can Foresight saves is the reason why
competitors took
only be met by sales nasty surprises. great strategies
advantage of our
staff. fail, because they are
advertizing.
duplicated by other
players.
9
10. The market size is increasing by approx 30% for Sonites and aprox 330% for Vodites
The savers segment is increasing to 48% and the shoppers segment to 37% in the next 5 years.
Over the next 5 years the shoppers segment on an average increases by 5.8% while the savers
are increasing by 10.9%.
The other segments are reducing and hence the above said 2 segments can be targeted to get
the maximum returns.
Set targets for market shares well in advance and try to stick to them.
10
11. Commercial teams should be allocated in such a way so that maximum sales can be availed from the various
avenues: Mass Merchandisers, Specialty Stores and Online Stores.
With unlimited budget, comes unlimited responsibility. Always remember that advertizing is an expense that will
ultimately be deducted from the revenues to get the EBIT. Spend prudently when you have unlimited budget.
Customize each product for a particular segment and price it accordingly. Avoid cannibalization of products.
The advertising expenditure and commercial team size needs to be competitive with respect to the market.
Don’t copy your market leader, but mark his moves.
11
