Start by showing this video:http://www.youtube.com/watch?v=ZyCsLv_SF1c1) Can anyone relate to this? Having the prof speak at a million miles per hour…2) Has anyone heard of the Smartpen?
From previous survey of the class, we will learn that the Smartpen product awareness is minimal. Our plan is to relaunch the promotional strategy because we believe it can be a great success.
How will we do this? Through today’s agenda. We will explain to you the reasons for the product relaunch and all supporting information that proves it potential success in the Canadian market.
http://www.youtube.com/watch?v=-Kh4Tpc9jfk2008: The Pulse Smartpen was introduced 2010: Launch of newest product into the American Market: The Echo SmartpenThe Smartpens allow you to take notes, draw, record and playback using a digital pen and dot paper. You can then upload the content on to your laptop or desktop using a USB cord and save, search and playback notes on your computer. It is setup so you can easily export and manage your notes and audio files. You can also easily share your notes and audio on Facebookor via email with your friends and classmates, or save as a PDF file in a single click. You can even pick up a language, get help with your studies or play games by downloading apps on your Smartpen. (See Appendix 15 for visuals)Multibranding strategy: Different names for its lines of Smartpen: Pulse and Echo
So a bit more on the product. The company,Livescribe was founded in 2007 in Oakland, California, USA by current CEO, Jim Marggraff.The Smartpen line has won 20 awards since its 2007 introduction.Point to Paper Tablet application(US$14.99) and talk about it. Paper Tablet works only with the Echo smartpenUse your Echo smartpen as a mouse and turn your dot paper notebooks into an extension of your screen. Once connected to your computer via a micro-USB cable, Echo can be used to mark up slides, presentations, PDFs, documents, and spreadsheets quickly and easily. Skip the hassles of scanning and add your signature, handwritten notes, drawings, or graphs directly into your digital documents. Enjoy the feel of pen on paper while capturing that brilliant idea, rough sketch, or even adding a personal touch to your emails.
Product life cycle status in USA: GrowthProduct: Pulse and Echo actively available. New features were added to the Pulse to help the product differentiate from the competitors. Market is mature enough to handle both variations, which is why a second pen was introduced.Product sales parallel to growing number of satisfied customers – viral marketing. Competition:Only competition are lower-end pens. Livescribe’sSmartpens are the only pen that captures hand written notes and the recording replay is synced with these notes. Price: Rapidly rising sales, rising profits, maximizing market share.Promotion: Build awareness of the mass market by Facebook, Twitter, onlineads prominent in American market , etc.Place: Many outlets: Online,Best Buy, Staples, Apple Stores, etc.
These past facts place them in the stars section.
Here is the distribution outlets in USAIncluding 19 apple stores in Canada. But having it in stores doesn’t help if theres no brand awareness. Also note distribution in Canada! It sucks. – very little providers.Now brings it to our main point! The LivescribeSmartpens have so much potential!! But obviously their promotional team didn’t have smart marketing students from McGill..probably from Concordia…. build their advertising strategy….Indirect channel: Through London Drugs and apple store and a small store in Toronto called Frontier Computing. );
In addition to only have 2 different outlets where the Smartpen in offered in Canada – London Drugs and Frontier Computing, their website lacks appealness. Comparecanadian and american website ->Smartpen’s means of Direct channeldistribution to the Canadian market is through this website, which is quite important for the image of Livescribe. They don’t even use the livescribe logo!! Customer must have recourse to an engaging website, tailored to the Canadian market’s needs.
In USA use social networking to advertise the product – VIRAL MARKETING FACEBOOK CIRCLED
To summarize: Livescribe depends on E-commerce for a bulk of its expected sales. But as seen before, the website sucks. And look at these stats above ^^^It grew to $15 billion?? WOW!! Wait….
Product life cycle in Canada (current): Stagnant in introduction caused by a lacking promotional effort.Marketing objective: create consumer awareness and stimulate trial. Product: As of now only the older Pulse pen is available in stores, to test market and ensure control of product quality. Market cannot handle the Echo just yet. Promotion: Inexistent, no building product awareness and no trials.Place: Limited to London Drugs, smartpencentral.com, Frontier Computing
To sum it up: these are causes for poor sales of the Smartpen.
We’ll like to reintroduce the product into the market and here is the SWOT.
Say that LIVESCRIBE SMART PEN is pretty much in a category to themselves – it is basically off the chart!
Geographic University Campuses: McGill, UBC, U of T, QueensApproximately 870,000 full-time students enrolled in Canada’s universities – (http://www.universityaffairs.ca/enrolment-up-again-across-Canada.aspx) Increasingly technological dependent world Everything is digitalized (e.g. music is now sold on iTunes, rather than physical albums) Academic institutions as well as businesses require use of a computer, forcing the less technologically savvy to adapt as well Keeping up with trends Electronic based education According to Fisher (2007), academic staff believe that digital tools enhance the storage of teaching materials, help reduce preparation time for class and offer a positive experience to the lecturer/student.
Geographic Financial districts: Toronto, Vancouver, and MontrealDemographicAcademic and professional/business world – time is so valuable for them. Generation X, Generation Y and late Boomers
Promotion Mix: Advertising, sales promotion, public relations, direct marketing Pioneering Advertising:Key objective: inform target marketEducate consumers about the product, its functions and where it can be found.Ad must be interesting, convincing, attention-grabbing and effective.Channel strategies: Pull strategy: creating consumer pull.Advertising directly to consumers, who then respond by demanding the product from the retailers, who will order the product from Livescribe.
Developing our Advertising Program Target audience: students, professors, and business people 2.Advertising objectives:Ensure the consumer’s ability to recognize the product and brand name.Spark an interest in the consumer’s desire to learn about the product’s features.Evaluation: Take note of any appraisals and critiques of the product.Provide the experience for a first time purchaser.
3. Setting the advertising budget: 1) Percentage of sales: funds for promotion and advertising as a percentage of past or anticipated sales.Increase allowance during high season such as back to school Sony’s percentage of sales dedicated to advertising averaged 6.22% from 2006-08 and Panasonic averaged 2.15% (both are electronics manufacturers) Therefore we believe that in order to successfully “re-enter” the Canadian market, Livescribe’s advertising budget should be around 6% of sales or above.2) Objective and Task:1. Objective: Inform the public of this product.2. Understand requirements needed to accomplish these goals:Timeline of advertising strategy importantUnderstand social effects3. Promotional cost: imperative to spend most of our budgeting on advertising and promotional sales to get the Smartpen’s message out. 4. Design the advertisement: similar to American one. Shows unified brand. Less confusion as to what is the REAL thing. Message strategy:Informational and persuasive elements directed at target market.Promote new and innovative Echo pen. Message execution: TV, radio, newspapers, internet, posters in school.Marketing communications mix: advertising, sales promotion, public relations, personal selling, direct marketing
5. Select Advertising MediaTelevisionReaches large audience, uses picture, print, sound and motion for effect.Increase airing frequency during high promotional season (back to school and Christmas). MagazinesHigh quality color, ads can be clipped and saved, tangible reminder of product.Business Week, Forbes. NewspapersAdvertise product at local retailers, low cost.Globe and Mail, university papers. InternetShows video and audio capabilities, use of social networking sites.interactive ads can link browser to main site 6. Scheduling the advertising:Pulse: A flighting schedule is combined with a continuous schedule because of fluctuations in demand, heavy periods of promotion, or during the introduction phase of a new product.Seasonal promotion: Summer promotions for travel pulse appsFall promotions for students, Christmas promotion for the holidays
Sales Promotions:Consumer-oriented sales promotionDeals: packaged deals. Contests: essay submissions, etc. Mail-in rebate: Encourage customers to purchaseTrial: Hold in stores trials Direct Marketing:Should be permission basedHave technology that can allow precise tracking of its performanceDirect mail, catalogs, and television adsAmazon.ca: help track history of customers, thus can make recommendations
Still thinking of idea…
AS MENTIONED EARLIER ONLY AVAILIBLE IN BC AND PRAIRIES ( LONDON DRUGES AND FRONTIER COMPUTING AND ONLINE)For CANADA we want to Expand the product on the ground to the same retailers as in the US:Best Buy, and Staples, The Apple Store, Amazon.ca (electronic marketing channel);Book Stores: Campus-specific, Indigo, Renaud-Bray, Archambault;Situated in the electronics section of large retail stores: Wal-Mart, CostcoStrategic Channel Alliance with Apple Canada:SmartPen complements and is compatible with Apple computers, yet does not detract from Apple’s consumers;Positive association of SmartPen with Apple for consumers who have never heard of LiveScribe and want a reliable productExpand the product to the same retailers as the US market Book stores (Indigo, Renaud Bray)Large Retail stores
Price of individual product should not be changed, only exception: in bundle Pricing strategiesApproaches currently used:Product line pricing: Echo should be priced similar to its predecessor – the PulseExpress value of pen, signals quality. Price Lining Echo: 4GB for $170 and 8GB for $199; they both have very similar costs of production.Odd-Even Pricing$199 vs. $200 for the 8GBBundling: should be used as a penetration pricing strategy: Used during high promotion season (back to school, Christmas).
We had to make some assumptions since Livescribe is still a private company and does not release any information on their expenses.Livescribe has a similar cost structure to the industry average of manufacturing firms in the audio and video equipment sector with revenues between $2 and $10 million in 2009.BreakdownVariable costs (cost of goods sold) are 62.6% of sales Fixed costs (operating expenses) are 33.7% of salesMarket Size: 11,090,266/1000
(add more notes under these headings)Our Integrated Marketing Communications strategy uses advertising, sales promotions, public relations and direct marketing to provide information to our target audience in the most beneficial way possible. Timeline:Before initial promotion launch:Do a pretest of advertising strategies.Promotion Launch (August):Perform execution of advertising strategy.Most effective: Back to school time. Run ads in beginning of August. Sales promotions: Bundling.Provide support throughout consumer purchase decision Perform IMC audit: Putting emphasis on effectiveness of different advertising strategies.Determine which elements of promotion works well in combination and eliminate any non-value adding promotions. Measure sales effect- compare past sales with past advertising.Post-test:Evaluate advertising campaigns.Make needed changes in time for Christmas promotional cycle.In May of the following year:Strategically advertise its multi- language capabilities for travelers.Learn from past advertising mistakes.