Marketing 201 Final Group ProjectDocument Transcript
Marketing Plan Project Report Group 7 Nick Daigle, Taylor Brewer, Mengjia Pan, Martin Summer MARKETING 302 Dr. Y. Henry Xie 06/12/2010
Five-Year Marketing Plan Skateboarding Dock Inc. Table of Contents1. Executive Summary……………………………………………………………………….2. Company Description……………………………………………………………………….3. Strategic Focus and Plan……………………………………………………………………….4. Situational Analysis……………………………………………………………………….5. Market-Product Focus……………………………………………………………………….6. Marketing Program……………………………………………………………………….7. Financial Data and Projections…………………………………………………………8. Organization……………………………………………………………………….9. Implementation Plan……………………………………………………………………….10. Evaluation and Control……………………………………………………………………….
1. Executive Summary 2. Company Description Skateboard Dock Inc. was started by co-founders Nick Daigle, Mengjia Pan,, Martin Summer, and TaylorBrewer, to develop and market Skateboarding Docks. These Docks were developed by the co-founders in order toprevent pesky wall and floor scratches caused by skateboards when they are placed against walls. They are a spaceconscious and user friendly unlike skateboarding racks that often take up space and involve assembly. One of themain attractions to Skateboarding Dock Inc.’s Skateboarding Dock is that they are customizable. The ability tocustomize the docks makes them more appealing to families because they blend in with the decor of the room. Skateboarding Dock Inc. will first be introduced in the west coast in beach towns where skateboarding isprevalent. Next, we plan to spread our reach through sub-urban neighborhoods throughout the all of the west coast,and eventually, expand nationally. We will aim their marketing to both College-Age and young adults, as well asmoms with children who skateboard who are trying to keep a more tidy house. Skateboarding Dock Inc. believes its high-quality, yet affordable, and customizable product will prove to besuccessful because to their knowledge there is not yet a product that compares. 3. Strategic Focus and PlanMission The mission of Skateboarding Dock Inc. is to market a high-quality and user-friendly Skateboarding Dock that iscustomizable to meet the varying needs of consumers in the trendy and volatile skateboarding industry whileencouraging creativity and ingenuity among our staff.GoalsThese are the goals that Skateboarding Dock Inc. seeks to achieve in the coming five years.• Non-financial Goals 1. To expand the reach of our product from the west all the way through to the east coast 2. To maintain a creative edge in our graphics department 3. To be well known for our ability to customize skateboarding docks for each customer
• Financial Goals 1. To have a public stock offering by the third year 2. To obtain a return on equity of at least 20 percent 3. Pay 50% of our loans back after the first three year Core Competency and Sustainable Competitive Advantage In terms of core competency, Skateboarding Docks Inc. seeks to (1) provide unique and high-quality Skateboarding Docks for each customer at an affordable price. The docks will be user-friendly, requiring no assembly, and also space conscious, unlike their competitors (skateboard racks). In addition, Skateboarding Docks Inc. seeks to (2) maintain an efficient ordering and delivery service. We will provide on-time delivery in a timely manner by using effective manufacturing and distribution systems that maintain the Company’s quality standards. These core-competencies will translate into a competitive advantage by achieving points of difference that will set the product on a different scale than that of its competitors. The fact that the company offers mass customization of skateboarding docks to match the decor of homes creates a tasteful addition to rooms. Our docks are also space conscious and require no assembly, making it user-friendly. 4. Situation AnalysisThe skateboarding industry is a growing niche market comprised mainly of teenage boys and moms in the home.With all the clutter associated with the consumer age the Skateboarding Dock offers an organizational and creativeopportunity for those families that participate in skateboarding activities. Overall, there seems to be no product likethe Skateboarding Dock in the market that satisfies the consumer need to organize skateboarding products in thehome. The following SWOT table gives a more in-depth look at the internal and external factors affecting themarketing opportunities for the product. Figure 1
Internal Strengths WeaknessesFactors Offers a variety of boards and accessories forOfferings Riding skateboards is a skill that not everyone has. both transportation and as a hobby There is a loyal market of young male Restricted market, male dominated. Many of theMarketing skateboarders and is expanding in a global young males in the market rely on parents to by the market. good. Skateboarding apparel is one of the cash cows Skateboards themselves provide only small amountFinance of the industry of the actual profits made in industryExternal Opportunities ThreatsFactorsConsumer/ Mostly active young males, 80% under the Few minorities and women skateboarders creates aSocial age of 18 limited access to many markets Skateboarding is a competitive sport with Must compete with other industries such as bikersCompetitive many professional boarders and rollerbladers. environmentally friendly and reduces cost of Economy is still in a recession and skateboarding isEconomic transportation not a necessity that all people are willing to pay for.Legal/ Laws requiring pads makes skate-boarding Skateboarding is illegal in many areas and in othersRegulatory safer and increases revenue on accessories has many restrictionsThe factors working for the company internally are its strengths of offering a new, easy-to-use product with lowlearning curve, niche market targeting the household buyer (moms), and the simply design ensures simple, low-costmanufacturing. Favorable external factors include the trendy nature of the target market, the environmentallyconscience nature of the product, lifting of anti-skateboarding laws nation-wide, little to no competition, thetransportation saving associated with riding skateboards and the organizational nature of moms.Among some unfavorable factors for the company, the main weakness for the product is the small size of the marketand possibly ‘uncool’ factor of the initial concept. Other unfavorable factors internal include the narrow appeal,lacking in an economy of scale manufacturing unit, no national awareness and small size of the market. Externalfactors, or threats, that we will work against include competition from other non-motorized transportation, thecondition of the economy and the classification of the product as not being a necessity.Industry analysisAfter years of unpopularity skateboarding as a trend is on the rise again. This is evident from the steady increase insales across the industry, including multiple successful games. The skateboarding industry is now a billion dollarindustry and has emerged a lifestyle. Recent stereotypes on the negative aspects of the activity have faded and anti-skateboarding laws lifted. Now, more than ever, moms are getting involved and making the activity a family
function. It is foreseeable that skateboarding industry will be in a substantial period of growth among the teenager,middle-age and mom market segments.CompetitorsCompetitors in the skateboarding market are non-existent for the current concept of an in-home organizational unit.There are skateboard racks found in stores for display purposes but are not used in the home.Company analysisThe founders of skateboarding Dock Inc. have extensive experience in the skateboarding and alternate sportsindustries. The Vice President of Marketing, Taylor Brewer spent 7 years in the same capacity at ElementSkateboard. The Chief Operations Officer, Martin Summer worked as the manufacturing director for BakerSkateboards. The other members of the executive management team served similar functions in companies likeAlien Workshop and Skateboard Magazine. Together they have a well-rounded concept of market trends andexperience implementing real market strategies that have worked in the past.Customer AnalysisCustomer characteristics and concerns. The skateboarding market is heavily made up of males, ages 10 to 30. Theymake up almost 80% of the market. Of that number many are young and live with there parents. Because of thismoms are another segment of the market as they are the decision makers and facilitate the skateboarding culture athome. Demographically, the market prefers to live and utilize skateboarding products in the suburbs and urbanlandscapes. They come from a wide range of socioeconomic backgrounds when young. The older purchase (18 andup) have a lower discretionary income, but prefer eco-conscience forms of transportation like skateboarding. 5. Market-Product FocusThe section of the plan describes the five-year marketing and objectives for Skateboarding Dock Inc., and the targetmarkets, points of difference, and position of the organizational product.
Marketing and Product ObjectivesNew markets. By the end of year five markets will exist in all major metropolitan markets and we will have twostore warehouses to store and ship the product. To achieve this we will obtain partnerships with Wal-Mart andTarget to store our products on their shelves.Skateboard Dock. Sales are expected to start off slow for the first year and the company will operate at close to aloss. The third year we expect to sell 59,000 units, and gain approximately $1.1 million in profits. By year five thatnumber is expected to increase by approximately 25 percent.Personal Sales. For the first two years Skateboard Dock Inc., will rely heavily on personal sales to appeal to thelarger retail chains. We will also build an eCommerce site for customers to order and customize the product. Thiswill be critical for those who don’t see it in stores. After the second year we will start appealing to medium-sizedskate shops in urban and suburban areas.Target MarketThere are two target markets for this product. The first are mom’s in the suburbs who have sons and the second arethe males 18 - 30, who live in urban areas.Points of Difference:There are two main points of difference the separate our product out from possible competition. The first is we offera customizable way for the customers to design their own products. This will appeal to their need to be trendy, amajor element of the skateboarding culture. The second is that this product is not for display or sale purpose likeskateboard racks in current skate shops. It is for organizing, self-expression and safety purposes.Positioning:The Skateboard Dock protects your walls and floors from scratches and marks, so you don’t have to clean them later.Customers will no longer have to be wary of walking around in the dark the house or in the garage in fear of tripping
over their skateboards. Skaters can have their dock customized to their liking, slap stickers on it, or paint the product,and show it off to friends. 6. Marketing ProgramThe following are four marketing mix elements of skateboard marketing program.Product StrategyProduct strategy will first summarize the product line, and then identify the approach to product quality andpackaging.Product Line. Skateboard docks, in order to satisfying different ages of people, are available in two sizes. Smallerdocks will be available for younger skateboarders with smaller boards and larger docks for teenagers and youngadults.Unique Product Quality. The environmentally friendly and clean characteristics of the skateboard are the priorities.Covered by a special material, skateboard docks make it possible for customers enjoy skating without worryingabout smearing floors and walls. Second, safety is guaranteed. Safety of skateboard is due to quality of material andlaborers skill. The skateboard are made from high-quality material and assembled by skillful masters. Besides, withthe proper size of skateboard, people are more easily to control the product.Packaging. Wisdom packaging will persuade potential customers to buy products rationally. Instead of packagingskateboarding docks in boxes, we will simply wrap them in a see-through wrap so that customers are able view thedesign on the individual skateboarding docks.Price StrategyThe company will set competitive retail price of $30 for standard skateboard docks and $40 for customizable docks.Because nearly 85% buyers are under 18 years old, they are price sensitive group. Low price of skateboard to someextent can encourage target market to buy the products and at the same time avoid other competitors to enter themarket.
Promotion StrategyPromotion strategies are covered in four areas: advertising, sales promotion, and personal selling, respectively.Advertising. Television, magazine, and competition are three forms of advertising. Television advertisements onchild- based cannels which stress the differentiation of the product can make more people know the product. Placingads in skateboard-related magazines by describing the main feature of the product and showing how simple andeffective the product is will prompt viewers to buy them. Competition is also an effective way to promote theproduct. After watching a fierce competition on skateboard skill outside of supermarket or mall, consumers are morelikely to show an interest on the product and purchase it.Sales Promotion. Coupons and rebates are used to attract price sensitive group.Personal Selling. Personal selling is a persuasive way to promote the product. By using individual-to-individualselling system, potential customers are clearer about the strengths of the product and will show more interest aboutthe product.Place StrategyDistribute skateboard docks to skateboard stores and other action sports stores in an effort to penetrate theskateboarding market. At the same time, the product can be distributed to major retail stores and shopping mallswhere parents usually shop for their children.
7. Financial Data and ProjectionsFive- Year ProjectionsFive-year financial projections for skateboard program are detailed below. These predictions are reflected the Projections FinancialElement Units Year 1 Year 2 Year3 Year 4 Year 5 Cases Sold 1 5000 25000 58000 69000 79000 Net Sales $1 $170,000 $850,000 $1,972,000 $ 2,346,000 $2,686,000 Gross Profit $1 $99,120 $495,600 $1,149,792 $1,367,856 $1,566,096 Operating Profit(Loss) $1 $5,000 $30,000 $74,000 $125,000 $185,000sustainable growth of the company. Figure 2
8. Organization Skateboarding Dock, Inc. will have a very basic organization structure, consisting of six branches: Marketing,Sales, Finances, Operations, Information Technology, and Graphic Design. These six branches will consist of onlynecessary full-time positions, and will all have branch supervisors who will report directly to the Co-Founders ofSkateboarding Dock, Inc. Due to the newness of the company, the use of temporary and contracted workers will be an important aspect toour employee workforce. Such workers will make the workforce more versatile and adaptive to our specificcompany needs. As the company grows, the option for these workers to become permanent employees withSkateboarding Dock, Inc. will be based on the budgets for the branches, and will be at the discretion of the branchsupervisors, provided there is no disagreement from the Co-Founders. Board of Directors President & CEO Graphic Design Marketin Sales Finances Operations Information Technology gFigure 3 Skateboarding Dock Inc.
9. Implementation Plan To introduce our new product into the market, Skateboarding Dock, Inc. will use promotional tools andadvertising strategies that stimulate growth through consumer awareness of the new product. Our product is theonly of its kind, so our goal during the introduction stage will be to ensure that consumers know about our productand have the ability to easily access it. We first plan to place our product in several major east coast cities, becausethe potential for growth in urban areas is substantial. After trials periods in each city, the Co-Founders ofSkateboarding Dock, Inc. will evaluate whether to stay and compete within the skateboarding market of that city, orfocus our efforts in new cities with higher potential growth. Skateboarding Dock, Inc. will begin our implementation plan with three major east coast cities in 2011, and,based on profit margins, we expect to be in every major east coast city within the 2-3 years. As our product gainspopularity on the east coast, our goal is to market our skateboard docks nationally by 2015. While staying largely inurban areas, sales of our product through large commercial chains such as Wal-Mart and Target will also make ourproduct available to any possible suburban and rural consumers. 10. Evaluation and ControlBeing a new corporation with an entirely new product may possibly offer some complications and difficulties whileentering these new markets within major cities, but will ultimately produce higher profit returns and greater brandrecognition once consumers gain awareness of our product. Since we offer the only skateboarding dock today, wealso have the ability to dominate the market and hold a large portion of the market share. Focusing our efforts inmetropolitan areas, we will constantly evaluate sales and profit margins in each city to ensure that our product isbeing placed where it is most likely to be sold. As our product continues into the growth and maturity stages of theproduct life cycle, we will continue to modify our marketing strategies to suit the needs of our consumers on anational scale.
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