1. Vice Presidents of Marketing; Jaspreet Garcha & Ryan Neal
Dark Eyed Junco O
Vice Presidents of Marketing;
Jaspreet Garcha & Ryan Neal
Ryan
Good morning everyone, im ryan neal and this is jaspreet garcha. We are the Vice presidents of marketing for Dark Eyed Junco O.

2. Brief History In charge of marketing for the past 10 years. Since then
Revenues increased
Contribution after marketing – $1,684,763
Stock Value increased
k$4,899 vs. nearest competitor at k$4,094
Market Position
Market Leader in Sonite for past 5 years
While Getting a budget the same as our competition.
Ryan
We are going to start off today with a very brief history of what we have accomplished.
We have been in charge of the marketing division of dark eyed junco o for the past 10 years.
Since we started we have increased revenue to a contribution after marketing of 1.6m dollars.
The stock value of our company has raised to 4.9 million while our nearest competitor is 800 thousand below us.
And we have been the market leader in our industry of sonite for the past 5 years.
All of this while getting a budget relatively the same as our competitors.

3. Starting in year 5 we become the Market Leader
Ryan
The first 4 years we were competing for market leader of the Sonite Industry
Starting in year 5 we become the Market Leader

4. Higher Net Contribution than our competition since the 2nd year
Ryan
Higher Net Contribution than our competition since the 2nd year

5. Higher Stock Price since the 2nd year
Ryan
Higher Stock Price since the 2nd year

6. With a Cumulative Return on Investment Higher than any of our competition
Ryan

7. Ryan
Even though we have been marginally higher than all of our competition on our returns, our budget is still the same as some of our competitors.

8. Mission
Our mission is to maintain our market leadership in the Sonite Market while increasing our market share in the Vodite Market by developing products that meet with consumers’ demands.
Jazz

9. Vision
To become the market leaders in both the Sonite and Vodite Markets while increasing our Return on Investments and Stock Price.
Jazz

10. Division Growth Strategies
Short-Term
Regain our market dominance in Sonite.
Developing New Sonite.
Gain a larger market share in Vodite.
Developing New Vodite.
Long-Term
Renew all of our products to match with our consumers’ needs.
Increase consumers’ purchase intentions for our products.
Through advertising, product development, and distribution channels.
Jazz

11. Portfolio Objective
Maintain market share while developing new products.
Maintaining market share in a growing market will increase our net contribution from $314,465,000 last year to an estimated $359,601,000.
Spend an extra $7.3 million to increase net contribution by an estimated $45 million while also meeting future demands of consumers.
Jazz

12. Portfolio results This Year Next Year (Estimated) Budget
$32,300,000.00
$40,280,000.00
Net contribution
$314,465,000.00
$359,601,000.00
Contribution After Marketing
Sonite Results
$178,313,000.00
$200,972,000.00
Advertising Costs
$12,254,000.00
$12,752,000.00
Sales Force Costs
$10,359,000.00
$12,747,000.00
Vodite Results
$137,340,000.00
$163,196,000.00
$3,500,000.00
$4,200,000.00
$3,980,000.00
$4,904,000.00
Ryan
Here you can see the portfolio results from last year compared with the estimated results we expect to receive next year.
Our budget will increase from 32.3 million to million, causing projected increase in net contribution change of $45.1 million.
These results come from the increase in our sonite and vodite products.
To better explain our increases in costs and revenues, I’ll show you a few graphs.

13. Comparing Current Values to Estimated Values
Ryan
As you can see here, our budget will increase by about $7m as mentioned before, and we expect that this will increase our net contribution by over $45m. This will come from an increase in sonite and vodite revenues.

14. Comparing Current Costs to Estimated Costs
Ryan
Where will our increased budget be used then?
Well, each of our costs will be increased in both the sonite in vodite markets, and we will also do a little research and development, which we will explain more about later.

15. Next Year’s Estimated Results
SOLD
SONO
SOHI
Units Sold
465,828,000
104,947,000
272,343,000
Revenues
$81,853,000
$37,908,000
$88,893,000
Advertising Costs
-$1,890,000
-$3,658,000
-$4,194,000
Advertising Research Costs
-$132,000
-$191,000
-$222,000
Sales Force Costs
-$2,836,220
-$2,220,080
-$3,705,610
Contribution After Marketing
$54,409,000
$21,195,000
$59,401,000
Ryan
Lets talk about each of the individual brands that we offer.
Sold and Sosg will end up with the same advertising and research as last year, while sono’s advertising and research expenses will drop a little over 5%. Meanwhile Sohi and VOP1 will both be increasing their advertising efforts by 20%. We decided to make these changes to maximize profit based on the projections that we got from the market forcast studies, specifically the experimental studies.
Meanwhile we increased our overall salesforce increasing the salesforce costs for all of our products. Specifically Sohi and Vop1 increased the most.

16. Next Year’s Estimated Results cont.
SOSG
VOP1
Total
Units Sold
622,908,000
359,416,000
1,825,465,000
Revenues
$119,542,000
$230,012,000
$558,223,000
Advertising Costs
-$3,010,000
-$4,200,000
-$16,952,000
Advertising Research Costs
-$210,000
-$344,000
-$1,099,000
Sales Force Costs
-$3,047,810
-$5,896,090
-$17,651,000
Contribution After Marketing
$65,967,000
$163,208,000
$364,179,000
Ryan
Lets talk about each of the individual brands that we offer.
Sold and Sosg will end up with the same advertising and research as last year, while sono’s advertising and research expenses will drop a little over 5%. Meanwhile Sohi and VOP1 will both be increasing their advertising efforts by 20%. We decided to make these changes to maximize profit based on the projections that we got from the market forcast studies, specifically the experimental studies.
Meanwhile we increased our overall salesforce increasing the salesforce costs for all of our products. Specifically Sohi and Vop1 increased the most.

17. Estimated Units Sold by Division
Ryan
Here you can see our projected unit sales by division, with the majority coming from SOSG , SOLD, and VOP1.
However, the marginal revenue on this products leads to our next graph.

18. Estimated Contribution After Marketing
Ryan
Here you can see our estimated devision revenues, these are all after contribution.
Showing vop1 as our higher earner and sosg as our 2nd best.

19. Next Year’s Estimated Results cont.
Contribution After Marketing
$364,179,000
Other Expenditures
Market Research Studies
-$1,008,000
Research and Development
-$3,570,000
Net Contribution
$359,601,000
Ryan
After adding up all of the contributions after marketing we get about 364 million in contribution after marketing. Then we subtract our market research studies and our R&D, and end up at an estimated net contribution next year of $359,601,000.

20. Individual Product Marketing
VOP1
Last Year
This Year
Target Market
Followers
Estimated Demand/Sales (in units)
303,013
359,439
Selling Price (in $)
$957
Media Budget (in $K)
$3,787
$4,544
Ad Message (Semantic 1)
Autonomy 5.2
Max Freq 3.8
Ad Message (Semantic 2)
Max Freq 5.3
Price 4.2
Salespeople per region
Specialty Stores
36.3 52
Department Stores
15.4 27
Mass Merchandisers
23.8
28.56
Jazz

21. Individual Product Marketing
SOLD
Last Year
This Year
Target Market
Others
Estimated Demand/Sales (in units)
386,993
465,828
Selling Price (in $)
$255
Media Budget (in $K)
$2,022
Ad Message (Semantic 1)
Max Freq 4.0
Power 3.3
Ad Message (Semantic 2)
Price 2.0
Price 2.1
Salespeople per region
Specialty Stores 11
6.5
Department Stores
20.79
12.6
Mass Merchandisers 34
32.64
Jazz

22. Individual Product Marketing
SONO
Last Year
This Year
Target Market
Professionals
Estimated Demand/Sales (in units)
108,946
104,947
Selling Price (in $)
$561
Media Budget (in $K)
$4,061
$3,849
Ad Message (Semantic 1)
Power 6.1
Max Freq 6.2
Ad Message (Semantic 2)
Price 6.6
Salespeople per region
Specialty Stores
15.4
19.5
Department Stores
7.7
10.8
Mass Merchandisers
6.8
10.2
Jazz

23. Individual Product Marketing
SOHI
Last Year
This Year
Target Market
High Earners
Estimated Demand/Sales (in units)
262,344
272,343
Selling Price (in $)
$497
Media Budget (in $K)
$3,680
$4,416
Ad Message (Semantic 1)
Design 6.2
Ad Message (Semantic 2)
Max Freq 3.5
Max Freq 3.4
Salespeople per region
Specialty Stores
19.8
32.2
Department Stores
16.17
25.2
Mass Merchandisers
6.8
10.2
Jazz

24. Individual Product Marketing
SOSG
Last Year
This Year
Target Market
Singles
Estimated Demand/Sales (in units)
540,007
622,908
Selling Price (in $)
$291
Media Budget (in $K)
$3,220
Ad Message (Semantic 1)
Max Freq 5.5
Design 5.1
Ad Message (Semantic 2)
Price 2.1
Max Freq 5.7
Salespeople per region
Specialty Stores
27.5
20.8
Department Stores
16.94
14.4
Mass Merchandisers
13.6
20.4
Jazz

25. Product Specifications
Split into individual product qualities and costs.
Inserted products under R&D for comparison.
Sonite and Vodite products separated due to specification differences.
Ryan
Now I’ll go over the individual specifications of each of our products.
We split them into individual product qualities and costs, then inserted products under R&D for comparison.
We will also be examining sonite and vodite products seperately due to the differences in specifications.

26. SOLD SONO SOHI SOSG Old SOLD SOTH PSOTH
SOLD
SONO
SOHI
SOSG
Old SOLD
SOTH
Research and Development
PSCP1
PSONO
PSPHI
PSPSI
PSOLD
PSOTH
Weight 17 13 16 18
Design 7 8 9 3
Volume 85 40 68 73 75 81
Max Freq 20 30 35 25 28
Power 61 63 12
Cost
105
209
160 91
117
Minimum Realistic
$103
$189
$160
$60
$117
Average Sale Price
$176
$361
$326
$192
$155
(estimated) $180
Cumulative Cost of R&D
(in $K)
$1,050
$2,500
$2,050
$1,300
$1,500
$940
Ryan
First lets look over the Sonite products.
Each individual product is geared towards a specific market segment, so all of their specifications vary.
Our most costly product to develop is currently our sono product, running at a cost of 209 per product with a minimum of 189. In the long run we intend to do R&D to reduce this cost to its minimum.
Now what I would like to focus on are these two products to the right here. The Current Sold product was developed aimed towards the others segment, but since the others’ views on this product have changed dramatically, and the new product we are developing to replace sold, named SOTH for development purposes, can be seen to the right. The main changes being design and power, which both changed drastically. With these changes we hope to regain our market share from the 30% that we have right now to the prior high, which was once at 70%.

27. Research and Development
VOP1
VPFOL
Research and Development
Autonomy 60 70
Max Freq 13 16
Diameter 55 62
Design 6 7
Weight 51
Cost
285
309
Minimum Realistic
$274
$309
Average Sale Price
$640
(estimate) $640
Cumulative Cost of R&D
$7,830,000
$2,830,000
Ryan
Next we’ll look at our vodite products. VOP1 is our product that we have already developed and we are currently selling in the market. The VPFOL product is the product we hope to release next year geared towards the followers. You can see there are changes in every category. These changes are projected to increase our market share with the followers market since it specifically is geared towards their ideal values while VOP1 was designed for the introductory period of the vodite market.

28. Market Research Studies
Sonite
Vodite
Costs
Industry Benchmarking
all Market
$40,000
Consumer Survey
yes
$135,000
Consumer panel
$228,000
Distribution Panel
$148,000
Semantic Scales
$26,000
Multidimensional Scaling
$94,000
Market forecast
$54,000
Competitive advertising
$80,000
Competitive Sales Force
Advertising Experiment
$68,000
Sales force Experiment
Total
$1,007,000
Ryan
Here you can see all the different market research studies in which we plan to purchase. Over the past 10 years we have purchased all market research studies every period, and plan on continuing that plan.

29. Why all studies?
We use them all each period to make crucial decisions on different aspects of the marketing plan.
Relatively low costs compared to the advantages that these studies give us.
Consumer survey, consumer panel, and distribution panel help to make decisions on how to advertise and where to send salespeople.
Semantic and Multidimensional scales help to decide what consumer’s needs are and how to meet them.
Market forecast helps us to decide how much of each product to make.
Competitive advertising and sales force help us to understand how our competition is using their marketing money.
The advertising and sales force experiments help us to understand how the demand would change if we changed our marketing strategies.
Ryan
So why do we purchase all the studies every period?
The main reason is that we use them every period to make crucial decisions that affect how our revenues are generated.
Plus there is a relatively low cost to these market research studies compared to the advantages that each of these studies give us.
The consumer survey, consumer panel, and the distribution panel all help us to make decisions on how to advertise our products and where to send our salesforce.
The semantic and multidimensional scales help to decide what our consumer’s needs are, how we are perceived, and how we can adjust our advertising to better fit with the consumer’s needs.
The market forecast helps us to decide how much of each of our product to make for the following year. If we over or under develop there is a loss of revenue, so this is important.
The competitive advertising and sales force studies help us to understand what our competition is doing to maximize their profits, so that we compare and contrast to our own strategies.
Lastly, the advertising and sales force experiments, which we deem as the most valuable, help us to understand how the demand would change if we changed our marketing strategies.

30. What does all this mean?
Reduced advertising costs on SONO by about 5.4%.
Over-advertising on this product to consumers.
Compensate by increasing sales force.
Increase sales force overall by 20%.
All products will benefit according to studies.
Increase advertising on SOHI by 20%.
Marketing studies show a substantial increase in sales.
Spend $700,000 to make forecasted $1,693,000.
Increase advertising on VOP1 by 20%.
Spend $700,000 to make forecasted $6,728,000.
Protect against losing market share with followers while gaining market share with innovators and early adaptors.
Jazz

31. What about Research and Development?
Improving our Others product.
SOTH
$840,000 estimated to complete.
Will help us to regain market dominance in the future with Others.
Introducing new Followers Product.
$2,730,000 estimated to complete.
Will help us to become more competitive in the Vodite field.
Will meet consumers wants.
Jazz

32. (all values in Thousands)
SOLD
SONO
SOHI
SOSG
VOP1
Total
Units Sold
465,828
104,947
272,343
622,908
359,416
1,825,465
Revenues
$81,853
$37,908
$88,893
$119,542
$230,026
$558,223
Advertising Costs
-$1,890
-$3,658
-$4,194
-$3,010
-$4,200
-$16,952
Advertising Research Costs
-$132
-$191
-$222
-$210
-$344
-$1,099
Sales Force Costs
-$2,836
-$2,220
-$3,706
-$3,047
-$5,896
-$17,651
Contribution After Marketing
$54,409
$21,195
$59,401
$65,967
$163,196
$364,179
Jazz
Other Expenditures
Market Research Studies
-$1,008
Research and Development
-$3,570
Net Contribution
$359,601

33. Budget Request
$40,280,000
Spending an extra $7.3 million compared to expected budget for this year.
Benefits
Expected increase in net contribution by $45m.
Development of new product to help regain market share in Sonite.
A new Vodite product to increase Vodite market share.
Jazz

34. Thank You

35. Backup Slides

36. Advertising Experiment

37. Sales Force Experiment

38. Why Would We Gain $45m from $7.5?
Starts with advertising and sales force
Increase in advertising and sales force changes the brand shares by segment.

39. Which increases Company Performance
Net Contribution Specifically

40. Without increase in Marketing the Net Contribution is at 314,465 instead of 359,601.

41. Why do we need to develop new products?
Because of changing consumer ideal values.

42. Our competition is better meeting the consumer’s demands, so we need to compete.

43. Our market share for SOLD with Others was 70%, now its 35%.

44. Extreme value changes in Vodite

56. THERE WAS A MISTAKE HERE