FIRM O Performance

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FIRM OPerformance Future Plans
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AGENDA

• Introduction
• Overview of Strategy Decision Rules
• Current Products (Sonite Vodite)
• SWOT Analysis
• Strategic Considerations
• Plans for the Future

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Mission Statement

• Seek to satisfy the precise desires of
• Sonite and Vodite consumers through
• intensive marketing analysis.

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Business-Level Strategy

• Enter Sonite and Vodite market
• Position as a market Follower
• Analyze customers and competitors through
  intensive marketing research
• Emphasize CRM

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Decision Rules

• Production more than needs
• Product segments desires
• Price segments perceptions
• Promotion segments preferences
• Place segments habits
• Financial marketing gt

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Current Sonite Market

• SONO
• Quality but adjust price by market
• Target segment Buffs
• Main competitors SEMI
• Brand awareness 69.20
• Purchase intention 28.7
• Market share 30.3
• Unit sold 55,049 units
• Retail sales 21,856 K

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Current Sonite Market

• SOLD
• Quality that cost more
• Target segment Pros
• Main competitors SERF, SULI
• Brand awareness 68.70
• Purchase intention 16.8
• Market share 17.0
• Unit sold 69,806 units
• Retail sales 36,366 K

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Current Vodite Market

• VOOM
• Total brand awareness 24.2
• Total purchase intention 1.7
• Total unit sold 13k Unit
• Retail sales 11,002k
• Market share 2.2

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Current Vodite Market

• VOOM
• The product under RD modification
• Target market segment Follower
• Forecasted growth rate for next
• period 108
• Forecasted growth rate for next five periods
  429

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VOOM in the PLC

• VOOM is in the introduction stage and will grow
  as the targeted segment grows

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Our Plans for the Vodite Market

• Increase the advertisement and the sales force
  budget as the targeted segment grows.
• Increase the brand awareness and the purchase
  intention level.
• Continue investment in the RD projects.
• Focus the distribution in the mass merchandise
  channel followed by department store.

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SWOT ANALYSIS

• STRENGTHS
• OPPORTUNITIES

• WEAKNESSES
• THREATS

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STRENGTHS

• Products consistently profitable
• SOLD 148,415 SONO 20,825
• Quality products
• Specialized in two segments (Sonite)
• High brand awareness
• Long-term goals in mind
• Good relationship among our departments

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WEAKNESSES

• Decisions regarding production, advertising and
  research
• Financial resources
• SONO is targeted to a market in decline
• VOOM has not brought profit so far

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OPPORTUNITIES

• Improve our current product VOOM to increase
  market share among the followers
• Our current base cost for VOOM is the lowest
  in the Vodite market
• We learned with our products SOHI SOUR the
  customer needs of 2 growing segments High
  Earners Singles

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THREATS

• Company E with its brands SEMI (Buffs) and
  SERF (Professionals)
• Company U with its brand SULI (Professionals)
• Vodite, competing with brands from stronger
  companies

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Strategic Considerations

• How will past results inform us as we approach
  the future?

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Lessons Learned

• Refine criteria for segment selection
• Invest more heavily in R D
• Analyze long term prospects

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Segment Selection

• Support new products with sufficient marketing
  dollars
• Establish competitive plan

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Research and Development

• Best way to cater to consumers desires
• Superior products
• Changing perception can rarely compensate for
  lack of suitability

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Long-Term Prospects

• Create alternative scenarios and action plans
• Follower must still anticipate
• Maintain financial reserves to support future
  projects

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Future - Viability

• The viability of the Firm O will eventually
  depends on its capability to
• sustain and to grow market share and
• to generate positive cash flow

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Future - Objectives

• Penetration strategies to expand market shares
  in the declining segments in the Sonite market.
• Product development strategies to expand
  market shares in the growing segments of the
  Vodite market.

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What is the competitive advantage of Firm O?

• The distinctive capability to sense and test
  opportunities in other market segments while
  retaining and growing the market position of its
  established brands to provide the resources to
  enable competition.

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Future - Strategies

• Cost focused strategies based on the
  competitive advantage of lower unit production
  cost in narrowly focused Buffs and Professionals
  segments.
• Differentiation strategies based on the
  competitive advantage of design and price
  differentiation focused on Follower segment.

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Future - Cost Focused

• Decrease marginal production lines (depth) of the
  same product class and total product lines
  (breadth) of the Firm.
• Generate steady earnings and attract new
  customers through improving product features and
  product line modification.
• Retain current customers through perception
  satisfaction focused on competitive advertising
  geared toward Buffs and Professionals.

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Future - Differentiation

• Leapfrog existing production lines of the
  competitors on features and quality to
  continuously improve and modify the product lines
  to meet the changing demand of customers of
  Followers.
• Base product improvement and modification on the
  relative perceptual feature and quality to RD
  product at comparatively lower cost.

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Future - Cash Flow

• Provide cash flow matched capital infusion into
  the SOLD and SONO lines to retain and grow market
  share through competitive marketing based on the
  favorable product characteristics and unit
  production costs.
• Fund the second wave of marketing with
  differentiation strategy geared toward Followers
  through debt financing with a test period of 5
  years.

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Future - Other Alternative

• Forming strategic alliances or merging
• with financially sound partners willing to
• establish solid footing in the Buffs and
• Professionals segments.