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Optical Distortion Marketing Plan

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Optical Distortion Marketing Plan

  1. 1. Optical Distortion Presented by: Srinivasan Raghavan Shawn Ritzenhaler Jaime Valle Matthew Lackowski Vlad Ignatov May 19, 2011
  2. 2. Agenda <ul><li>Product positioning </li></ul><ul><li>Market conditions </li></ul><ul><li>Segmentation and targeting </li></ul><ul><li>Pricing </li></ul><ul><li>Distribution </li></ul><ul><li>Conclusion </li></ul>
  3. 3. Product Positioning <ul><li>Cost-effective alternative to de-beaking </li></ul><ul><li>Reduced bird mortality </li></ul><ul><li>Reduced egg-laying trauma </li></ul><ul><li>Reduced feed consumption </li></ul><ul><li>Decreased cost </li></ul>
  4. 4. Situation and Market Forces <ul><li>First mover advantage </li></ul><ul><li>Patent and license protection for 3 years </li></ul><ul><li>Exclusive use of technology </li></ul><ul><li>Exclusive relationship with supplier for 3 years </li></ul>
  5. 5. Segmentation and Targeting <ul><li>Medium and large farms </li></ul><ul><li>Regions with dense chicken population </li></ul>Farms Hens Hens/Farm Pacific Region 592 45,516,021 76,885 South Atlantic 1081 46,372,092 42,897 Mountain 26 1,488,794 57,261 West South Central 526 28,252,131 53,711 East South Central 400 18,311,473 45,779 East North Central 398 15,360,907 38,595 West North Central 199 8,661,383 43,525 Middle Atlantic 324 15,629,652 48,240 New England 161 7,955,616 49,414
  6. 6. Pricing <ul><li>Price Per pair </li></ul><ul><ul><li>Price Ceiling: $0.28 </li></ul></ul><ul><ul><li>Price Floor: $0.08 </li></ul></ul><ul><li>Price to capture value </li></ul><ul><li>Price to encourage adoption </li></ul><ul><li>Price at $0.18 per pair </li></ul><ul><ul><li>- Even split of economic value with farmers </li></ul></ul>Saving Per Hen Mortality $0.124 Egg-laying trauma $0.044 Feed $0.112 Total $0.28
  7. 8. Assumptions: Year 1 Year 2 Year 3 Year 4 Year 5 Number of farms Targeted 592 1673 2599 3520 3707 Conversion Rate 50% 50% 50% 50% 50% number of farms Purchased 296 836.5 1299.5 1760 1853.5 Number of Sales people 8 21 33 44 47 Number of technical representatives 2 5 7 9 10 sell price (Introductory Price in Year 1, Value Based Price in Year 2 & 3, Post Patent Expiry Price in Year 4 & 5) $0.18 $0.18 $0.18 $0.18 $0.18 Volume (Targeted) 45,516,021 91,888,113 138,451,717 178,103,659 187,548,069 Volume (Purchased) 22,758,011 45,944,057 69,225,859 89,051,830 93,774,035 Revenue 4,096,442 8,269,930 12,460,655 16,029,329 16,879,326 COGS (784,696) (1,584,151) (2,386,908) (3,070,507) (3,233,329) Regional Office expense (196,000) (392,000) (588,000) (784,000) (784,000) Sales person (320,000) (840,000) (1,320,000) (1,760,000) (1,880,000) Technical Representative (70,000) (175,000) (245,000) (315,000) (350,000)             Fixed Cost Per Year           Research and Development Expense (250,000) (250,000) (250,000) (250,000) (250,000) Headquarters Expense (614,000) (614,000) (1,200,000) (1,200,000) (1,200,000) Advertising expense (100,000) (100,000) (100,000) (100,000) (100,000) Trade Show Expense (100,000) (100,000) (100,000) (100,000) (100,000) Licensing Fee (25,000) (25,000) 0 0 0 Pre-Tax Net Income 1,636,746 4,189,779 6,270,747 8,449,822 8,981,998 Total Pre-tax income 29,529,091        
  8. 9. Distribution – 5 year Plan <ul><li>Cover the continental US </li></ul><ul><li>50% market penetration </li></ul><ul><li>4 regional sales offices </li></ul>
  9. 10. Conclusion <ul><li>ODI lenses can offer considerable cost savings for farmers </li></ul><ul><li>ODI is in an advantageous first-mover position with monopoly power </li></ul><ul><li>Segmentation by farm size and targeting medium and large farms </li></ul><ul><li>Pricing - $0.18/pair to maximize profits </li></ul><ul><li>Distribution based on region profitability </li></ul>
  10. 11. Happy hens– Happy farmers!

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