Marketing Report

Decisions 6

Results from Period 5

With a new product each in the Sonite and Vodite market, Logix continued to be the industry leader. However there was a SPI drop to 3543 which was a 22% drop from the previous period. Period 5 saw 3 new companies enter the vodites market, taking 47% of Logix’s market share. The new product Leap targeted towards Followers contributed to 13% in revenues. The competitors in the vodites market had a much larger advertising and commercial team budget along with lower prices.

In the sonites market, Logix saw immense success with its new product London, and modified products Love and Logo. The demand was higher than the production in this market, due to which we had potential lost sales. London captured 8.3% of the market in its first year of launch, directly competing with Tour. On the other hand Logo emerged as the most preferred product for the High Earners with a purchase intention of 30.4%.

For Period 6, the marketing team decided to focus on increasing the advertising and commercial team sizes, and adjusting the prices and price perceptions to match the ideal values of the targeted consumer segments.

Budget allocation

Sonites

Production: With London’s initial success, an increased advertising and commercial budget would capture an estimated 40% of the shoppers market, leading to a production of 350k units. Logo emerged as a highly desired product for high earners and had the highest purchase intentions. To capture the rising star’s market the production was increased to 160k units. Whereas Love aimed towards the Professionals was set to a production target of 130k units.

Pricing: The Prices were adjusted slightly for Logo to match the utility values of High Earners to $465. London was priced at $300, same as last period and Love was reduced to match the utility value for professionals at $400.

Advertising: To keep up with the momentum in the sonites market, the advertising spend was increased at $9865k, and the...