Call Girls In Aerocity Delhi ❤️8860477959 Good Looking Escorts In 24/7 Delhi NCR
Concept Development for Salon Industry
1. 5/7/15
1
MKT530-‐ New Product Development
IBEAR
Spring 2015
Trojan Scissors
Deepak Alse
Hugo Lozano
Jack Huang
Ryan Zhang
Executive Summary
• The Salon Industry is a fragmented industry with poor asset utilization
and a relatively inelastic recession-‐proof market that grows steadily
based on demographic growth. These factors make the industry
opportune for a market aggregator platform as well as automation
solutions that enhance repeatability and reliability.
• After a detail evaluation of the market and evolving technical
capabilities, Trojan Scissors Inc proposes to enter the market with
Salongo! , the one stop solution for customers who want salon
services on demand, serviced by smart salon owners and stylist who
value their time and want to offer the best value for money.
2. 5/7/15
2
Product Innovation Charter (PIC)
• Background
• The Salon Industry is a fragmented industry with poor asset utilization and a relatively
inelastic recession-‐proof market that grows steadily based on demographic growth.
These factors make the industry opportune for a market aggregator platform as well as
automation solutions that enhance repeatability and reliability.
• Focus
• Salon Industry
• Goals/Objectives
• Less than 12 month ‘Time to Market’ .
• Should solve atleast one key problem for the customer, stylist and the salon owner.
• Guidelines
• We should solve a problem that can generate multiple alternate and concurrent sources
of revenue.
Industry/Market
No Dominant Players -‐ Regis, Great
Clips, Sports Clips, Ratner & JC Penney
-‐ Top 5 players cumulatively have less
than 10% of market.
25% Capacity Utilization
2.5% Annual Revenue Growth
$3.1Bn in Profits in 2014
3. 5/7/15
3
Competition
138 Vendors but none focused on customer ; None of these combine
the customer and stylist markets
Value Chain
Customers
Stylists
• Salaried
• Independents
Salon Owners
• Salon Station
Leases
• Fully owned
Salons with
salaried
employees
Distributors
for Salon
equipment
Government
• Federal, State
and City
regulations on
cosmetology.
4. 5/7/15
4
Multidimensional Perceptual Map of Hair
Styling Needs
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Ability.to.get.haircuts. for.everyone.in.
the.family.simultaneously.
Ability.to.have.a.conversation. with.the.
stylist
Ability.to.regularly.change.your.hairstyle
Time.spent.at.Salon/barbershopPrice.paid.for.the.haircut
Hair.Design.and.styling
Consistent. Quality.of.Haircut
Most salons are not
running at their full
capacities;;
Customers don’t have a
clear picture of the salons
around them with price and
quality information.
Our enterprise
• Trojan Scissors is a entrepreneurial venture in early stages.
• We have a strong understanding of new product development, business
model development and prior experience with entrepreneurial roles and
ventures.
• Our team has the technical leadership skillset to identify and manage top
talent for technology based products.
• We are focusing on entering an industry ripe for disruption due to
• Low asset utilization
• No dominant player
• Constant growth based on demographics.
• Strong presence of localized network efforts with respect to promotions and pricing
with limited need for vertically integrated distribution .
5. 5/7/15
5
Expanded SWOT
Strengths Weaknesses
• Technical competency of the team
• The new haircut helmet, Styleserve and Salongo
create an integrated haircut service ecosystem to
meet the different clients’ needs and involve all
kinds of salon and barbers.
• Ownership of patents to support our products
• Lack of a strong brand
• Lack of prior Salon industry experience with
current team
• Lack of distribution network and prior marketing
experience within the industry.
• Early Stage Startup with need to generate cashflow
ASAP.
Opportunities Threats
• Most customers do not need regular changes to
hairstyle
• Growing Use of smartphones
• Absence of a strong dominant player in the market.
• Rapid evolution of mobile and laser technologies.
• Regulatory change created by lobbying through
professional guilds and implemented at local level
to create a barrier for application of new
technologies.
• Price competition in the salon and stylist market
may lead to poor services.
SWOT Strategies
• What are strategies to
maximize the strengths and
opportunities?
• Shorter Product Development and
Testing Cycles
• Invest in product development for
a concept with lower capital
expenditure needs and a faster
time to market.
• What are strategies to mitigate
the weaknesses and threats?
• Recruit Salon Industry experts and
create a board of advisors
• Low key early launch to test
market and product prior to large
launch campaign.
6. 5/7/15
6
Concepts Generated
Haircut Helmet
• Primary target market –
Men ( 20-‐50yrs of Age)
• Features – Helmet that cuts
your hair quickly and with a
consistent style
• Benefits – Time, Consistency
and Using Cutting Edge
Technology.
• Positioning – Fast Haircut
with Consistent Quality.
StyleServe App
• Primary target market –
Men & Women ( 20-‐50 yrs
of Age)
• Features – Smartphone App
that gets you a price
guaranteed haircut for the
entire year.
• Benefits -‐ Value &
Convenience
• Positioning – A subscription
deal that reduces hassles
Salongo! App
• Primary target market -‐ Men
& Women ( 20-‐50 yrs of
Age)
• Features –Smartphone App
that matches you with the
best available stylist when
you want them.
• Benefits – Time , Value,
Convenience
• Positioning – On Demand
Styling at the price you want
to pay.
Development and Strategy Soundness
Evaluation
Concept Generation
Brainstorm
Concept Statements
Value Chain Analysis
Primary Research
with Surveys
Perceptual Map
12 Dimension
Analysis
Concept Evaluation
based on Survey
Responses
Scoring Model
Delphi Method for
Selection of
Concept
Market Sizing
Bass Model For
Customer
Acquisition and
Innovation Diffusion
Pricing and Revenue
Analysis
Breakeven &
Cashflow Analysis
We use a scoring model to identify concepts
that best fit our technical and commercial
capabilities as well as opportunities. In order
to manage the varied views and opinions
within the team, we followed a Delphi
method to achieving consensus on the best
concept for implementation. Each team
member scored all 3 concepts on the basis
of a common set of weight assigned to each
relevant criteria. The concept that achieved
the highest average score with the lowest
standard deviation was chosen as the best
concept. In this particular case, the product
was Salongo.
7. 5/7/15
7
Scoring Model For Concepts
12 Dimensions Assessment
Dimension Definition Helmet StyleServe Salongo!
1. Offerings Develop innovative new products or services H M H
2. Platform
Use common components or building blocks to create
derivative offerings
H L H
3. Solutions
Create integrated and customized offerings that solve
end-to-end customer problems
H M H
4. Customers
Discover unmet customer needs or identify underserved
customer segments
H L H
5. Customer Experience
Redesign customer interactions across all touch points
and all moments of truth
H L H
6. Value Capture
Redefine how company gets paid or createinnovative
new revenue streams
M L H
7. Processes
Redesign core operating processes to improve efficiency
and effectiveness
H L H
8. Organization Change form, function or activity scopeof the firm H L H
9. Supply Chain Think differently about sourcing and fulfillment H L H
10. Presence
Create new distribution channels or innovativepoints of
presence
H L H
11. Networking
Create network-centric intelligent and integrated
offerings
M L H
12. Brand Leverage a brand into new domains H M H
8. 5/7/15
8
Summary of Results
• None of the concepts win 80%
or more in terms of interest and
trial likelihood.
• Haircut Helmet Concept is loved
by customers and is likely to win
on trials and highest scores for
meeting customer expectations.
• However, Salongo scores highest
on our scoring model and on the
12 dimensions assessment.
Helmet StyleServe Salongo
Trial ( Top 3 Boxes) 62.50% 42% 41%
Favorable response
(Top 2 Boxes) 62.30% 47% 41%
Recommendations
• As a startup venture with limited funds as well as gaps in salon
experience, we believe that the Salongo! product offers us the best
opportunity to enter the business , solve a problem and a pain point
associated with the capacity utilization in salons.
• We believe that Haircut Helmet, StyleServe and Salongo are in a
continuum of needs and we can successfully build all 3 into an
integrated product portfolio.
• Salongo! offers us the optimum ability to build a strong network, a
comprehensive industry ecosystem with access to multiple profit
pools and performs well on customer need related criteria.
9. 5/7/15
9
The Product
App and platform for salon services saving time for
customers , generating valuable revenue against slack
time for stylist and and improving convenience for
customers.
Target customer
Customers who need a salon service on demand but
with a deal!
Distribution channel
Direct to Salon Owners and Stylists
Customer benefits
Best price at a level of convenience and chosen quality of
service.
Revenue model
300$ per year subscription service for stylists with
additional paid services and features for revenue
management
Is the one stop solution for customers who want salon
services on demand, serviced by smart salon owners and
stylist who value their time and want to offer the best value
for money.
Acquire
Stylists &
Salons
Acquire
Customers
Customers
find Stylists
Customers
pay
through
app
Customer
Review
Stylists and
Salons
11. 5/7/15
11
This half of the customer segment is our target market
Welcome to
Salon
California
12. 5/7/15
12
We plan on asking for 10% of revenue growth achieved
through
Salons operate at average utilization of 25%. 5% increase in
utilization rate will bring extra $3200 per annum per stylist.
Needs
$150K for product development expenses
$50K for launch expenses
For 9 month rollout timeframe
We’ll offer 1% Equity($15 Million valuation) with first right of
refusal for further issue of equity after breakeven.
13. 5/7/15
13
Will
Curate the salon ecosystem to always ensure that the top
25% of best reviewed stylists are proposed for the price
range requested by the client.
Have a roadmap with add-‐on competitively priced solutions
for
• Customer analytics capabilities
• Revenue management
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9
Product Development Product Transition to Production
Product Alpha Testing Product Beta Transition
Alpha Launch
Product Beta
Launch
Product Soft
Launch
Alpha Customer Acquisition Beta Customer Acquisition Customer acquisition to scale
Salon & Stylist Acquisition
App Advertising
Starts
Social Media
Campaign
Content Marketing Starts in Salon websites
14. 5/7/15
14
Can
Acquire
2000 SalonStylists & 177K Users by Year 1
5000 SalonStylists & 420K Users by Year 2
9000 SalonStylists & 760K Users by Year 3
Breakeven inYear 2
Stylist Acquisition
Stylists Acquired -‐ Year 1 2,114
Stylists Acquired -‐ Year 2 5,041
Stylists Acquired -‐ Year 3 9,060
Customer Acquisition
Population of California 38,802,500
Adults 50%
% with Smartphones 75%
Target Market Size 14,550,938
Customers Acquired -‐ Year 1 177,521
Customers Acquired -‐ Year 2 423,353
Customers Acquired -‐ Year 3 760,904
Financial Model and Projections
Current Utilization 25.10%
Revenue Per Stylist 30.74
Revenue Per Salon 21760.33632
Total Revenue 27826400000
Number of Salons 1278767
Number of Stylists 1,732,584
5% Increase in Utilization per Salon 26,095
Increased Revenue due to 5% increase 4,335
Increase in Revenue Per Stylist(5% Increase in Utilization) 3,211
Number of Stylists in California 173,258
App Revenue Per Stylist 300
Criteria Year 1 Year 2 Year 3
Development Cost 100,000 120,000 144,000
App Maintenance Cost 20,000 47,696 85,725
Customer Support Costs 20,000 28,386 44,180
Staffing ( 1 Operations Director, 1 Business
Development Director) 150,000 225,000 225,000
Basic Operating Cost 20,000 30,000 40,000
Stylist Acquisition Cost 60,000 85,159 132,540
Customer Acquisition Cost 355,043 503,920 784,292
Pre Launch Costs 50,000 0 0
Total Cost 775,043 1,040,162 1,455,738
Total Revenues 634,126 1,512,261 2,718,032
Revenues -‐ Cost ( Cash Flow) -‐140,917 472,099 1,262,294
Cumulative Cost 775,043 1,815,205 3,270,943
Cumulative Revenues 634,126 2,146,387 4,864,419
Cumulative Revenues-‐ Cumulative Costs (
Breakeven) -‐140,917 331,182 1,593,475
15. 5/7/15
15
Contingency Plan
• Measurements and processes to insure that the plan is monitored
and evaluated.
• Monthly Customer Acquisition & Stylist Acquisition Velocity.
• Uptime and Availability for the software app and platform.
• Number of sale transactions recorded on the app.
• Alternative strategies to be implemented if objectives are not met or
exceeded.
• Offer incentives to salons and stylists for signing their current customers on to
our platform.
Preview our product here! Preview Here
16. 5/7/15
16
Exhibits
Concept – Haircut Helmet
A novel haircut helmet that provides the fastest and most consistent
hairstyling solution in the world today. This state-‐of-‐the-‐art device
will let you manage your precious time better, focusing on the things
that really matter to make you happier. The helmet makes a 3-‐D
model of your hairstyle and repeats the hairdo the next time you
need it Laser technology has been used for decades in other
applications; today it gives you the opportunity to replicate a normal
or very complex designed hairstyle the same way as it was cut the
last time. This advanced technology has been proven to be
trustworthy, accurate and fast; bad haircuts are a thing of the past.
Get seated, identify yourself, wear the helmet and in less than 5-‐
minute you will have a haircut. It’s that easy! The national average
price for a haircut is $28; the haircut helmet will offer the same
results faster and hygienically and for a better price.
17. 5/7/15
17
Concept -‐ StyleServe
Introducing StyleServe-‐An app on your
smartphone that gives you a subscription to
haircut and styling service. You can buy an annual
subscription for 12 haircuts and only pay for 10.
Just purchase the subscription through the app,
then answer a couple of questions to help us
identify the salon and stylist best suited to your
needs and schedule an appointment on demand!
No more hassles of trying to find a stylist or calling
a salon to schedule your appointment!
Concept -‐Salongo
Salongo! is a smartphone App for customers who
need a salon service on demand but with a deal!
Use Salongo to designate a circumference of areas
around your location, a range of time and an
acceptable maximum price –We’ll then ask our
hairstylists to bid for your haircut, you may choose
from those who bid and make the deal. When you
go to the hairstylist’s place and get your haircut,
you may pay via Salongo and provide comments
the service you just received. As easy and simple
as that!