To: Executive, Zoecon Corporation From: Date: Thursday, February 17, 2005 Subject: Strike Roach Ender Introduction Projected Industry Consumers Professional Projected Growth Rate of 10% annually Projected growth rate of 8% annually Projected sales of $4. 4 million Projected sales of $2. 7 billion Flea IGR Introduction – Similar Scenario Great success of introduction of flea IGR PRECOR into PCO, veterinary and pet store markets. o In 1980 Zoecon broke into the supermarket segment by selling the PRECOR ingredient to it’s competitor dCo no In early 1983 Flea Ender (using PRECOR) was introduced to supermarkets by Zoecon – 11 % of the market was captured by late 1983 o Flea Ender’s success attributed to a second 3 rd party competitor S.
C. Johnson By 1985 Strike Flea Ender had captured 18% of the flea pesticide market and continues to achieve it’s profit objective Consumer test market AnalysisZoecon’s introduction of the Strike Roach Ender has captured a substantial portion of the test area household market segment. As seen in Table A the brand was recognized by over half of the households in the market and 6 %, (70, 200 households) of those households purchased the brand, resulting in a profit of $ 247, 180. 40.
The Essay on Middle England Market End Retail
There are plenty of observers who will claim that Marks & Spencer is dying, and I'm inclined to agree. I'm not suggesting that the retail monolith is going bust, or is about to be bought by Wal-Mart and rolled into one brand with Asda. It's just that the old M&S is dying and a new child is taking its place. Signs that nature has been taking its course have been apparent over the past ...
Though repeat purchases were also high at 30% (21, 060 households) the profit generated was not enough to sustain a revenue in the trial market. Zoecon ended the market in a net loss of $$1, 230, 819. 40. Figures are further broken down in Table A. Contribution margins were also high for Strike Roach Ender.
Aerosol Strike had a contribution margin of 55. 1% and fog ger had an even higher margin of 57% as seen in Table B. Table C projects the break even analysis in both units and dollars as a basis for further projections. As seen in Table C substantially larger sales are required to break even. Industry Market Analysis Using the techniques from the test market estimates of market share and projected sales for the 19 city (80% of trial insecticide volume) are made for the introduction of Strike Roach Ender into the household market.
I also chose to increase the advertising budget by 20% which increased costs to upwards of $12 million. This further drove the net loss to a final projection of $6, 844, 476 as seen in Table D. Much like the test market Contribution margins were also high for Strike Roach Ender. Aerosol and fog ger Strike had a contribution margin exceeding 50% as seen in Table E. Table F projects the break even analysis in both units and dollars as a basis for further projections. As seen in Table F substantially larger sales are required to break even.
Therefore more profitable alternatives and options must be sought to compliment or replace 19 city introduction. Options & Alternatives Roll-out Strike Roach Ender in projected 19 city market at a premium price Pros: 1. A share of projected annual increase of sales in the continually growing 2. Strike Roach Ender will hold high profit margins Cons: 1. Continual loss of profit Roll-out Strike Roach Ender into the 19 cities Strike Flea Ender is currently in Pros: 1. Consumer familiarity with Strike product 2.
Increase in sales and decrease in promotional costs to introduce new product Cons: 1. Consumer confusion due to similar strike name 2. Continued costs without achieving projected market share Enter into and agreement with a 3 rd party to include GENCOR ingredient Pros: 1. Initial introduction into the market by a competitor will pave the way for Zoecon’s won premium product with fewer costs 2. Profits made by selling to a 3 rd party Cons: 1. Unable to capture a profitable market share with Zoecon product after competitor entersSuggestionZoecon has developed a significantly improved product in the roach growth regulator market.
The Business plan on Market Segmentation, and Product Positioning
For the purpose of this assignment, I am assuming myself as the owner of a plastic molded toy company in United States that manufacturers, and distributes plastic molded toys through retailers across the country and around the world. The company is capitalizing on the strong growth in the children’s toys segment and planning to expand in an aggressive manner throughout the nation. The company ...
It has shown that by promoting the product to an appropriate target market at a premium price it will hold yield high profit margins and achieve strong market penetration – though still not generating a profit. Therefore, I would recommend a marketing strategy similar to that of Strike Flea Ender (as highlighted in the similar scenario section. ) This proposed plan would involve a mixture of options one and three from the alternatives given above. Specifically, Zoecon would approach a 3 rd party: S. C.
Johnson, d Con or Boyd-Midway about purchasing GENCOR to supplement their roach control products. Zoecon may then have a better chance of penetrating the 19 city roach regulator market with its premium quality product.
