Jonathan Kirkland, AndrewBurakov, OertaTrepca, Jeff SchneiderMAR 431 - NEW PRODUCTDEVELOPMENT
Hi, I’m Ragnvard!Welcome toSweden.RAGNVARD. Empowered Design.
Jonathan KirklandProduct launch with price skimming strategy
Perceptual MapJeff SchneiderDesignConvenience
Novice•“Technologyhas a limitedimpact on mylife.”Apprentice•“Technology ischanging my life.”Journeyman•“Technology is anim...
“WIZARD”Earlyadopters ofnewtechnologyMore likelyto beunemployedSingle, MenAged 25-35OertaExperian Simmons 2010 Technology ...
What are Wizards like?WIZARDPay anything forelectronicproducts I want(Index 203)Spend moretime play videogames thanwatch T...
What are Journeymen Like?JourneymenDoing moreshopping/internetthan before (Index210)Like to hear aboutproducts/servicesby ...
Onlineactivities• Video games• Download Movies• Chat forumsComputer/VideoGame Brands• Sony Vaio• XboxCell Phones• iPhone• ...
Onlineactivities• auctions• personal ads/datingservices• listen to satellite radioonlineComputer/VideoGame Brands• Apple M...
The Ikea Customer & TechnologyShopped at Ikea within last 3months.Own an appleiPodIndex: 199I’m alwaysfirst amongmy friend...
RAGNVARD’s Chasm• By garnering the enthusiasmof the innovators and earlyadopters in the beginning, weare able to create th...
Media Multi-TaskingOertaExperian Simmons 2010 Technology Report
Preference of Media OutletsExperian Simmons 2010 Technology Report Oerta
A strong positioning on productbenefits25 to 35 year olds rely heavily on their cell phones in their daily life:- stay on ...
TVCommercial• 30-second spot• Negative aspects of wires anduncharged devices in our dailylivesThe solution: the wirelessch...
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff Schneider
Jeff SchneiderPrintAdvertisingRepeated full page advertising-GQ, with a focus on lifestyle-Wired, with a focus on technolo...
IKEA Catalogue CoverRelease: August 2014Circulation: 212 million copiesJeff SchneiderRelease: August 2014Circulation: 212 ...
OnlineAdvertisingIntensive online promotion strategy1. Company owned channels2. Social media3. Third-party websitesIncrea...
Page SkinningProduct specificRich Media Advertising Jeff Schneider
Jeff SchneiderInstagram ContestDuration: 2 months prior to product launchPrize: New RAGNVARD desk for best submissionCosts...
Facebook AdvertisingJeff SchneiderCPM cost: $0.5 to $1.20 CPMTotal Costs: $150,000
Jeff SchneiderDisplay & Rich Media AdvertisingInterstitial Advertising“a splash page displayed before an expected content ...
“Furniture goes digital” - TimesSquare Event- RAGNVARD desks available for trial- Billboard streaming every 30 minutes-Con...
DistributionAndrew
AvailabilityPopulation Age: 25-34(%) BaseArizona 6,553,255 12.7% 832,263California 38,041,430 14.3% 5,439,924Colorado 5,18...
2014July August September October November DecemberDevelop A PrototypeCarry Out In-house TestingGet User End FeedbackRefin...
skimming
Corporate Social Responsibility• For every charging table sold, Ikeawill donate a percentage of theproceeds to the ikeafou...
Ikea’s Commitment to the ForestsWhile working with Ikea’s on staff forestspecialists and our suppliers, thecharging table ...
Cost Estimate And PriceBESTÅBURS$270 X 55%*= $143 Table Surface Area/ Area Of 1 Coil1030/5.5 ≈ 187Price Of Transmitter X C...
Sales ForecastSales Goals- Approximately double sales volume to170,000 units sold in 2016- Increase awareness and sales ra...
A promising 3-year Profit & LossStatement2014 2015 2016Sales Volume 77,000 110,000 170,000Price: $850 $800 $750Net sales $...
Control & Update• RAGNVARD will have monthlyscheduled tests to monitorperformance of the product on awide scale• Audits on...
MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch
MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch
MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch
MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch
MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch
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MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch

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Pace University MAR431 New Product Development Group Project (Presentation Version)

Task: Idea Generation, Concept Evaluation, Product Development, Launch

Introduction of a new generation of technology furniture: RAGNVARD. Empowered Design.

A unique customizable design desk that allows to charge a multitude of mobile devices through surface contact.

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  • Product slogan will emphasize both benefits and will build on the innovation effect in the consumers’ mind.
  • Fleur de Noyer – Chest of drawersDuracell PowermatStandard cableTeknion Powermat
  • People are encouraged to envision their own furniture piece of the future and submit it through an Instagram post or upload it directly to the contest page on Statigram. The hashtags#EmpoweredDesignand #FurnitureOfTomorrowhave to be attached to each post in order to enter for a chance to win the brand new RAGNVARD desk as soon as it is released.
  • Next we used the ATAR Model
  • In order to estimate a price, I first multiplied Besta Burs $270 retail price by the cost of goods sold ratio reported in Ikea’s annual income statement and found an estimate cost of $143. I then found a electronics retailer that sold transmitters at $3. By cutting the Wholesale retailer out we estimated that covering the surface area of the table excluding a 1 inch border plus the table itself would cost approximately $424. Then a 100% markup would make the final price $850. Over time the profit margin will have to go down as competitors develop more substitutes for our product.
  • MAR431 New Product Development - IKEA new Wireless Charging Desk Product Launch

    1. 1. Jonathan Kirkland, AndrewBurakov, OertaTrepca, Jeff SchneiderMAR 431 - NEW PRODUCTDEVELOPMENT
    2. 2. Hi, I’m Ragnvard!Welcome toSweden.RAGNVARD. Empowered Design.
    3. 3. Jonathan KirklandProduct launch with price skimming strategy
    4. 4. Perceptual MapJeff SchneiderDesignConvenience
    5. 5. Novice•“Technologyhas a limitedimpact on mylife.”Apprentice•“Technology ischanging my life.”Journeyman•“Technology is animportant part ofmy life.”Wizard•“Technology islife.”Experian Simmons 2010 Technology Report Oerta
    6. 6. “WIZARD”Earlyadopters ofnewtechnologyMore likelyto beunemployedSingle, MenAged 25-35OertaExperian Simmons 2010 Technology Report“Journeyman”Earlymajority fornewtechnologyMore likelyto bemarried withchildrenSingle, MenAged 30-45
    7. 7. What are Wizards like?WIZARDPay anything forelectronicproducts I want(Index 203)Spend moretime play videogames thanwatch TV (200)Im 1st of friendshave newelectronicequipment (196) Interestedreceivingadvertisementson cell (193)Likely purchaseproducts seeadvertised onmy cell (186)Experian Simmons 2010 Technology Report Oerta
    8. 8. What are Journeymen Like?JourneymenDoing moreshopping/internetthan before (Index210)Like to hear aboutproducts/servicesby email (200)Internet changehow I shop forproducts (194)I spend less timeread magazinesb/c internet (188)Internet changedway I work (184)Experian Simmons 2010 Technology Report Oerta
    9. 9. Onlineactivities• Video games• Download Movies• Chat forumsComputer/VideoGame Brands• Sony Vaio• XboxCell Phones• iPhone• Boost Mobile• Songdownloading, musicplayer, messagingExperian Simmons 2010 Technology Report Oerta
    10. 10. Onlineactivities• auctions• personal ads/datingservices• listen to satellite radioonlineComputer/VideoGame Brands• Apple Mac• Game BoyCell Phones• Sony Ericson• T-mobile
    11. 11. The Ikea Customer & TechnologyShopped at Ikea within last 3months.Own an appleiPodIndex: 199I’m alwaysfirst amongmy friends tohave thelatest inelectronicequipmentIndex: 172I love to buynew gadgetsandappliancesIndex: 144I try to keepup withdevelopmentsin technologyIndex: 142Far aboveaverage earlyadopterIndex: 129Experian Simmons 2010 Technology Report Oerta
    12. 12. RAGNVARD’s Chasm• By garnering the enthusiasmof the innovators and earlyadopters in the beginning, weare able to create the primarymarket interest needed toobtain the early majority• By surpassing the “chasm”that divides technologywizards and some journeymenwe will be able to reach thevast majority of consumersthat identify as apprentice’sOerta
    13. 13. Media Multi-TaskingOertaExperian Simmons 2010 Technology Report
    14. 14. Preference of Media OutletsExperian Simmons 2010 Technology Report Oerta
    15. 15. A strong positioning on productbenefits25 to 35 year olds rely heavily on their cell phones in their daily life:- stay on top of the news,- connect with their social network- express who they are.- use extra features extensively: Internet, gaming, multimedia, researching.Those activities consume a lot of energyand batteries exhaust quickly.A convenient way of charging mobile devicesautomatically improves life quality Jeff Schneider“staying connected”“convenience”
    16. 16. TVCommercial• 30-second spot• Negative aspects of wires anduncharged devices in our dailylivesThe solution: the wirelesscharging desk, RAGNVARD!Production costs: $250,000.Prime-time spots: $5,000,000Jeff Schneider
    17. 17. Jeff Schneider
    18. 18. Jeff Schneider
    19. 19. Jeff Schneider
    20. 20. Jeff Schneider
    21. 21. Jeff Schneider
    22. 22. Jeff Schneider
    23. 23. Jeff Schneider
    24. 24. Jeff Schneider
    25. 25. Jeff Schneider
    26. 26. Jeff Schneider
    27. 27. Jeff Schneider
    28. 28. Jeff Schneider
    29. 29. Jeff Schneider
    30. 30. Jeff Schneider
    31. 31. Jeff Schneider
    32. 32. Jeff SchneiderPrintAdvertisingRepeated full page advertising-GQ, with a focus on lifestyle-Wired, with a focus on technology-The Economist, with focus on globalization-Forbes, with focus on success and careerEstimated costs: $500,000MRI* Total 000 Proj 000 Pct Across Pct Down IndexWired 2549 614 24,1 1,8 159GQ 6518 1562 24 4,5 158TheEconomist 2644 602 22,8 1,7 150Forbes 5,111 952 18.6 2.7 123Fall 2011 Media - Demographics - Head of Household 25-34,Total Adults
    33. 33. IKEA Catalogue CoverRelease: August 2014Circulation: 212 million copiesJeff SchneiderRelease: August 2014Circulation: 212 million copiesDesignRAGNVARD, wirelesscharging desk$850/ea
    34. 34. OnlineAdvertisingIntensive online promotion strategy1. Company owned channels2. Social media3. Third-party websitesIncreased targeting opportunitiesEasier access to younger demographicsJeff Schneider
    35. 35. Page SkinningProduct specificRich Media Advertising Jeff Schneider
    36. 36. Jeff SchneiderInstagram ContestDuration: 2 months prior to product launchPrize: New RAGNVARD desk for best submissionCosts: $5000Includes:-Contest tab on statigr.am-Feature in Newsletter-Contest Management Platform-Participant Contact Database
    37. 37. Facebook AdvertisingJeff SchneiderCPM cost: $0.5 to $1.20 CPMTotal Costs: $150,000
    38. 38. Jeff SchneiderDisplay & Rich Media AdvertisingInterstitial Advertising“a splash page displayed before an expected content page. The interstitial istypically displayed for about 20 to 30 seconds before taking the viewer to thedesired content page.”Targeted websites:www.nytimes.comwww.mashable.comEstimated costs: $300,000X
    39. 39. “Furniture goes digital” - TimesSquare Event- RAGNVARD desks available for trial- Billboard streaming every 30 minutes-Content: Tweet hashtags in real-time20 desks can be won over weekend- Live roundtable with influential techbloggers to discuss the opportunities ofcombining design, technology andfurniture.Jeff Schneider
    40. 40. DistributionAndrew
    41. 41. AvailabilityPopulation Age: 25-34(%) BaseArizona 6,553,255 12.7% 832,263California 38,041,430 14.3% 5,439,924Colorado 5,187,582 14.6% 757,387Connecticut 3,590,347 12.0% 430,842Florida 19,317,568 12.2% 2,356,743Georgia 9,919,945 13.5% 1,339,193Illinois 12,875,255 13.8% 1,776,785Maryland 5,884,563 13.4% 788,531Massachusetts 6,646,144 13.1% 870,645Michigan 9,883,360 11.8% 1,166,236Minnesota 5,379,000 13.6% 731,544New Jersey 8,864,590 12.7% 1,125,803New York 19,570,261 13.9% 2,720,266North Carolina 9,752,073 12.9% 1,258,017Ohio 11,544,225 12.3% 1,419,940Oregon 3,899,353 13.7% 534,211Pennsylvania 12,763,536 12.1% 1,544,388Texas 26,059,203 14.3% 3,726,466Utah 2,855,287 15.7% 448,280Washington 617,996 14.1% 87,137219,204,973 29,354,603* Percentages based onhttp://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_11_1YR_S0201&prodType=table• Only 20 States havean Ikea• Only 12-16% ofpeople in these statesare 25-34 years oldAndrew
    42. 42. 2014July August September October November DecemberDevelop A PrototypeCarry Out In-house TestingGet User End FeedbackRefine Product Based On FeedbackSet Up Machine Equipment For Mass ProductionDevelop Logistical SystemsRAGNVARD launchIKEA catalogue launchIKEA website product skinning adsInstagram ContestTV CommercialTimes Square EventIn-store demonstrationPrint AdvertisingFacebook AdsVideo Interstitial Ads6-Month TimelineAndrew
    43. 43. skimming
    44. 44. Corporate Social Responsibility• For every charging table sold, Ikeawill donate a percentage of theproceeds to the ikeafoundation inorder to benefit children andfamilies living in poverty all overthe world.• The ikeafoundation will havehelped over 100 million childrenby 2015.OertaIkeafoundation.com
    45. 45. Ikea’s Commitment to the ForestsWhile working with Ikea’s on staff forestspecialists and our suppliers, thecharging table will be made of woodfrom trusted sources, therebylimiting the affect on the world’sforest.Ikeahas worked toward using moresocially conscientious materials sincethe 1990’s.Proceeds from the charging table wouldbe allocated towards Ikea’s annualscholarship for students fromRussia, Poland, Latvia, Estonia andLithuania to study sustainableforestry at the Swedish University ofAgricultural Science.The scholarship is available for studentsevery year.OertaIkea.com
    46. 46. Cost Estimate And PriceBESTÅBURS$270 X 55%*= $143 Table Surface Area/ Area Of 1 Coil1030/5.5 ≈ 187Price Of Transmitter X Coils Needed$3# X 187 ≈$562Subtract Wholesales discount (50%)≈ $281IDTP9030 TRANSMITTERCost: $424Price: $850(100% Profit margin)* Based on a rounded Profit margin taken from the COGS on the Consolidated Income Statement# www.mouser.com/ProductDetail/IDT/P9030-0NTGI/?qs=sGAEpiMZZMtEG0FVrTlw%252buwq7j9oGsalnge2V%252bNt744%3d (estimated value) Andrew
    47. 47. Sales ForecastSales Goals- Approximately double sales volume to170,000 units sold in 2016- Increase awareness and sales ratios to1%, currently at .05% in 2016- Increase awareness to 85% of the Baseby 20162014 2016Total Base 29,354,603 29,354,603Total Awareness (75%, 85%) 22,015,953 24,951,413Total Availability (70%) 15,411,167 17,465,989Sales (.05%, 1%) 77,056 174,660US Population 313,900,000Population with anIkea In State 219,204,973Availability Ratio 69.83%Andrew
    48. 48. A promising 3-year Profit & LossStatement2014 2015 2016Sales Volume 77,000 110,000 170,000Price: $850 $800 $750Net sales $65,450,000 100% $88,000,000 100% $127,500,000 100%Cost of Goods Sold ($424/Table) $32,641,000 50% $46,640,000 53% $72,080,000 57%Gross Profit $32,809,000 50% $41,360,000 47% $55,420,000 43%Operating ExpensesAdministrative $3,272,500 5% $4,400,000 5% $6,375,000 5%R&D $9,817,500 15% $13,200,000 15% $19,125,000 15%Promotion ExpensesAdvertisement $6,505,000 10% $8,800,000 10% $12,750,000 10%CSR $1,309,000 2% $1,760,000 2% $2,550,000 2%Total Operating Expenses $20,904,000 32% $28,160,000 32% $40,800,000 32%Net Income $11,905,000 18% $13,200,000 15% $14,620,000 11%Employees (Avg Salary: $40,000) 81 110 159Andrew
    49. 49. Control & Update• RAGNVARD will have monthlyscheduled tests to monitorperformance of the product on awide scale• Audits on the product will betaken weekly in order tomaximize sales performance andfocus our sales strategy onmarkets that bring the highestROI.• Re-allocation of merchandisebased on performance will occurmonthly on the RAGNVARDcharging deskOerta

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