Group 18 Business Model- Revenue Side Bristol, Cuozzo, Holz, Lyman, Patibandla, Sexton

ShoeSkin Recap & Changes ShoeSkins Concept Benefits, Challenges Macro-Industry Analysis – low attraction – CROCS, Heelys – targeted success Target age was 5-12 – Change to 9-14

Agenda Core Strategy Customer Interface Strategic Resources Value Network Pricing & Revenue Forecasting Conclusion

Core Strategy Our mission is to be the leader in the Interactive Footwear for teens and tweens between the ages 9-14 in the United States and Canada Shoe Skins will be selling a “participatory footwear experience”- not a new kind of shoe

Differentiation Strategy Different from Existing Footwear Manufacturers Business model based on selling more Skins instead of shoes New business driven by existing users (networking) Different from Novelty/Custom Footwear The Shoe/skin system is unique Real as well as virtual communities among users

Some Sample Skins

Customer Interfaces Shoe Skins Shoe Skins Shoe Skins Website Mall Kiosk Point of Sale Display Eric

Realtionship Dynamics Shoe Skins Website S ho e S ki ns Point of Sale Display Sh oe Sk ins Mall Kiosk Eric Virtual connection through Shoe Skins website Presence on social networking sites Virtual communities created by the users Face to face connection through Mall-based kiosks Specialty and gift stores

Fulfillment and Support Product Sizing Printable Fitting Guide User profile data ShoeSkin Size Skin Size Users profiles searchable for gift purchases. Eric ShoeSkin SizeSkin Size

Information & Insight Users register on website to receive free skin. Website records user purchases. Sort data, demographics, designs, network, etc. – # of each design sold –where? – Design of the week – Most popular designs – Games unlock with purchase Collect Comments, Recommendations Delete Eric

Core Competencies & Processes/Systems Eye-popping high quality designs Cultivate a user community Rapid “Design to Doormat” Superior customer experience Managing supplier/partner relationships. Eye-popping high quality designs Cultivate a user community Rapid “Design to Doormat” Superior customer experience Managing supplier/partner relationships.

Strategic Assets & Resources Shoe Skins S Online/Retail Presence IT Infrastructure Patents Culture at Shoe Skins Employees & Customers Online/Retail Presence IT Infrastructure Patents Culture at Shoe Skins Employees & Customers

Value Network – Suppliers Shoe manufacturing (outsourced) overseas Skin material manufacturing (outsourced) in the US Logistics (supply chain, shipping) Legal Shoe manufacturing (outsourced) overseas Skin material manufacturing (outsourced) in the US Logistics (supply chain, shipping) Legal Update Eric

Value Network – Partners Third-party designers (kids and professionals) Boutique shops / shoe retailers (sales channel partner) Schools and Fitness clubs that offer kids programs. Advertisers to get into strategic media markets. Third-party designers (kids and professionals) Boutique shops / shoe retailers (sales channel partner) Schools and Fitness clubs that offer kids programs. Advertisers to get into strategic media markets. Combine with coalitions Eric

Value Network – Coalitions Trade associations Local communities Networking Visibility Find potential business allies Trade associations Local communities Networking Visibility Find potential business allies Delete Eric

Business Boundaries RETAIN INTERNALLY OUTSOURCE Eric

Pricing Structure Basic offering: Shoe System (includes pair of shoes & 1 skin & a code for a 2 nd skin) Additional Skins sold in stores/kiosks as well as online at an incremental price with bundle pricing for multiple skins or group orders Custom Skins at a small premium Shoe Skins site provides accessible Delete Eric

Product Pricing Base shoe SRP: $39.99 – Includes 1 skin and a registration code redeemable for a 2 nd skin on the Shoe Skins website. Additional skins SRP: – $ 4.99 for standard skins – $ 5.99 for logo or branded skins – $ 6.99 for custom skins (group discounts will apply) Base shoe SRP: $39.99 – Includes 1 skin and a registration code redeemable for a 2 nd skin on the Shoe Skins website. Additional skins SRP: – $ 4.99 for standard skins – $ 5.99 for logo or branded skins – $ 6.99 for custom skins (group discounts will apply) Eric

Forecasting Method Identified Shoe Skins as a combination of novelty footwear and bricks & mortar/web hybrid Found analogous products and looked at their growth –Webkinz –Heelys Identified target segment by geography to size overall market Identified Shoe Skins as a combination of novelty footwear and bricks & mortar/web hybrid Found analogous products and looked at their growth –Webkinz –Heelys Identified target segment by geography to size overall market Eric

Analogous Products- Crocs & Heelys Eric

Analogous Product- Webkinz Webkinz geographical adoption pattern Eric

Base Unit Sales Forecast Year 1Year 2Year 3Year 4Year 5 Conservative 5,341 36, , , ,000 Midrange 10,682 58, , , ,000 Aggressive 16,023 62, , ,000 1,440,000 Eric

Skins Unit Sales Forecast Year 1Year 2Year 3Year 4Year 5 Conservative 10,682 73, , ,000 1,650,000 Midrange 21, , ,000 1,320,000 2,880,000 Aggressive 32, , ,000 3,780,000 7,920,000 Eric

Revenue Forecast Year 1Year 2Year 3Year 4Year 5 Conservative $ 266,893 $ 1,831,197 $ 5,996,400 $ 12,591,600 $ 32,227,500 Midrange $ 533,785 $ 2,898,767 $ 12,591,600 $ 25,782,000 $ 52,761,600 Aggressive $ 800,678 $ 3,441,028 $ 18,887,400 $ 52,453,800 $ 97,106,400 Eric

Configurations Update Eric/SP

Conclusion Unique Business Model Website addresses real customer pain points of online shoe purchase User adoption pattern and expansion strategy defines the growth Our existence depends on Securing a patent Ability to cultivate relationships with suppliers, customers and employees SP Update

Conclusion Who are we again? What are we selling? How are we different? What are the limitations? How can we get there? – By securing a patent – Cultivating relationships with suppliers, customers and employees SP Update

Appendix

Strategic Resources – Culture The values the firm is passionate about. – Passion for kids’ needs…it’s about the customer. – Childlike exuberance and fun – Innovation and design is our specialty – Teamwork… – People who love to have fun and play games – Love self-expression / individuality Update/Delete SP