NCG Week Case Competition

Intro Situation Complication Objectives Proposal Timeline Risks/Results

Introduction
Situation Analysis
Agenda
Solution

Agenda
Timeline
Risks and Assumptions
Wrap-Up

Daniel
Marzec
● Sophomore
● Computer Engineering
Drew
Pinkerton
● Sophomore
● Supply Chain Management
Prajwal
Chandrashekar
● Freshmen
● Mechanical Engineering
Josiah
Mooney
● Sophomore
● Needed a team
OUR TEAM

+ +
Growing movement
of environmentally
friendly transportation
Sustainability Shift
Profitable last few years
and government funding
Large Budget
Increasing frustration with
operational inefficiencies
Customer Dissatisfaction
Micro Cars have steady
and dominating market
share
High Car Usage
+
SITUATION

Restrictions
-Government
-Infrastructure
-Pricing
Untapped Customers
Large segments of customers are
untapped. Lack of focus on
specific high-growth potential
segments
Reputation
Delays cause dissatisfaction
High customer expectations
Lack of organizational unity
Growth
Must stimulate 7.5% increase in
passenger kilometers within 3
years
COMPLICATION

KEY OBJECTIVES
 Eliminate delays in
information
 Create a seamlessly
integrated user
experience
 Increase annual travel
distance by 7.5% in 3
years
 Remain profitable
 Leverage $400
million budget
 Satisfy high
expectations
REPUTATIONPOLITICALECONOMIC

8
Commerce Slides
RE-BRAND
INTEGRATE
RE-STRUCTURE
THE RIR SOLUTION

9
Commerce Slides
RE-STRUCTURE

Create new parking spots in
each of the 200 least used
stations
Parking
Pricing
RE-STRUCTURE
Decrease prices for all non-
peak hours
Safety
Reassure customers about
changes done to assure
safety

11
Commerce SlidesIntro Situation Complication Objectives Proposal Timeline Risks/Results
RE-STRUCTURING STRATEGY 1: PARKING

Create at least 30 new parking
spots in each of the 200 least used
stations
Motivated Non-User segment 702000 people
50% acquisition of segment in 10 years 351000 people
60 customers per spot 5850 spots
Stations with lowest traffic/most 200 stations
29.25 spots/station
Daily spendable parking tickets for
customers.
RE-STRUCTURING STRATEGY 1: PARKING

13
Commerce SlidesIntro Situation Complication Objectives Proposal Timeline Risks/Results
RE-STRUCTURING STRATEGY 2: PRICING

Decrease prices for S-train for all
times around the rush hours
Continue removing the number of
“products” offered
RE-STRUCTURING STRATEGY 2: PRICING

Emergency Call Systems placed
strategically throughout the stations
Immediate Customer Safety
alerts sent through the app
RE-STRUCTURING STRATEGY 3: SAFETY

EXPENSES
REVENUE
 20,000 Krone per parking lot
 Conservative Emergency Call Box price estimate
 $406,000 Projected Expenses in 2 Years (Appendix B)
NET EFFECT
FINANCIAL ANALYSIS
 Conservative New Customer Acqusition Estimate
 $1,392,000 in Additional Revenue in 2 years (Appendix B)
 New Customer Acquisition
 $986,000 Projected Net Income in 2 Years

17
Commerce Slides
INTEGRATE

Multiple apps required
Inaccurate and late reports
Limited functionality
Overall lack of integration
Current State

Commerce Slides
Simple User
Interface
Design
Easier Point of
Service with 24/7
Support
Service
Trip planner and
seat reservations
Plan
Store Frequent Routes and get updates on timing
Bus and Taxi service integration
Immediate safety alerts
Increased Mobile Payment Processing
Our Solution

Customer Acquisition
Platform for growth
Passenger Analytics
Predict and prepare for
customer needs
Data Collection
Feedback and optimization
Point of Service
Direct link to customer
INTERNAL
BENEFITS

EXPENSES
 $540,000 Initial Investment (Appendix A)
REVENUE
 $792,000 Projected Revenue in 3 Years (Appendix A)
NET EFFECT
FINANCIAL OUTCOME
 $252,000 Projected Net Income (Appendix A)
 Seamless consumer experience
 2,000 added customers per month

RE-BRAND
RE-BRAND

Current State of DSB’s Brand
Slow and Delayed
Subpar Customer
Service
Outdated and Expensive

24
Commerce Slides
1 New Logo
Incentive Programs2
3
RE-BRANDING PLAN
Advertising Campaign

Unmotivated Heavy
Motivated Light Motivated Non-User
Motivated Medium
● Digital Savvy
● Live in Capital Region
● Find travel stressful
● Women and Singles
● Environmentally aware
● Capital region and Aarhus
● Elder and Married
● Capital region and
large cities
● High income
● Rural demographic
● 2+ km away from train
stations
● Take car or bus
TARGET MARKET SEGMENTS

1 New Logo

Referral
Program
Loyalty
Program
● 5 km per referral (around 20% of average trip: Appendix C)
● Gain market share through continuous referrals
● Integrated through mobile app
● Discounted pricing for travel times around rush hour
● 5% of kilometers travelled awarded back
● Integrated through app
● Retain customers through incentives
2 Incentive Programs

Advertisements
Television
• Advertisements focused on
new station features, app and
+time
• Market: All targeted
Social Media
• Facebook, Instagram and
Twitter ads with direct link to
app and info on sustainability
• Market: Unmotivated heavy
and Motivated medium
Billboards
• Billboards with a focus on
+time and sustainability
around less populated areas
• Market: Motivated non-users
3

29
Commerce Slides
Potential Market Growth
Bull
• 4% market growth in one Year
• Approximately 2,475,000,000 km (Appendix C)
Conservative
• 3% market growth
Bear
• 2% market growth
 Total Expense: 16,600,000 Krone or 2,400,000 USD
(.05% of annual budget)

Task
Year
1
Year
2
Year
3
Unveil Logo
Marketing
Launch Plan
App
Development
App Launch
App Support
Construct New
Parking
Safety
Construction
Adjust Pricing
30IMPLEMENTATION TIMELINE

31
Commerce Slides
● Performance of marketing
campaign depends on many
factors
● Limited time to change brand-
image
● Innovations in sustainable
transport
● Customer retention
● East-West construction will
cause periodic delays for 3 years
Low Medium High
RISKS

IMPACT
Economic Political Reputational
• Expanded customer base
• App as alternate revenue
stream
• Meeting high demand
• DSB serves as backbone of
Denmark’s transportation
• Political expectation for
growth satisfied
• Seamlessly integrated user
experience
• Delays, traffic info, security
• Communicating change to
the consumer

Appendix A: IT Development Financials
● $500,000 for frontend and backend development
○ As seen in instagram and ubers development (source:
https://savvyapps.com/blog/how-much-does-app-cost-massive-review-pricing-
budget-considerations)
● $20,000 to restructure train & rail system GPS infrastructure
○ Source: http://www.gps.gov/applications/rail/
● 0.05% per transaction ~ $20,000 set-up
○ Source: https://paylinedata.com/pricing/
● $20,000 ad revenue per month
○ 160million monthly users * 50%
○ Source: http://ryanmorel.com/mobile-advertising-calculator/
● New customer acquisition rate estimate = .005%
○ Population with smart phones = .73(total population) = 4.03mil
○ ~$2,000 in ad revenue calculated from
○ Source: http://ryanmorel.com/mobile-advertising-calculator/

Appendix B: Re-Structuring Financials
● 2,800,000 in Expenses
○ Parking spots = (200 stations)*(10,000 Krone per parking lot) = 2,000,000 Krone
○ ECB= (400 stations)*(2,000 Krone per station) = 800,000
● Ticket Prices
○ http://www.fyidenmark.com/ticketprices.html
● 9,600,000 Krone in Revenue
○ Revenue = (2,000 customers per month)*(48 months per 2 years)*(100 Krone per
ticket)= 9,600,000 Krone
● Conservative monthly new customer acquisition rate estimate = .05%
○ Population with cars= .70(total population) = 3.92mil*.0005= 1,996 potential
customers

Appendix C: Branding Financials
Kilometers travelled through DSB: 6,246,000,000 (10.1% market share)
Total Kilometers travelled in Denmark: Approx. 62,000,000,000 passenger km
4% market share: 62,000,000,000 * .04 = 2,475,000,000 passenger km
Expenses(1 year)
2 ads a day on primetime: 6,800,000 Krone
4 ads non-primetime: 6,800,000 Krone
Make 6,000,000 impressions with 250,000 downloads: 2,000,000 Krone
40 billboards in rural areas: 1,000,000 krone
Total: 16,600,000 krone
Average trip length: Passenger kilometer / Total trips taken(domestic + abroad)
6,246,000,000 / (191,881,000 + 9,185,000) = 31.1 km
6 km / 31.1 km = .19%

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