1. MAXIMIZE Goal and Takeaways Objective : Net Contribution
What we learned from SABRE:
Implement appropriate target market approach
Align marketing expenditure and productions
Marketing timing is important
When there is little market share potential, focus on profitability
Implement appropriate target market approach
Align marketing expenditure and productions
Marketing timing is important
When there is little market share potential, focus on profitability – develop R & D with lower unit prod. Cost  high contribution margin

2. 5 C’s analysis Framework Spartan Flash Company
2 well-positioned products in 2 high-growth market segments
Limited budget
No products at onset;
Competition
Not very competitive
Only 1 competing product in the 2 segments we aimed at
Potential competition
No competition at inception
Customer
Defined preferences
Unknown preference shift
Unknown preferences
Context
Defined segments with healthy growth
Opportunity from emerging segment
Emerging market
Collaborator
Sales force already in place;
Market studies support
No sales presence
No market studies available
Use 5 C’s to develop strategy….decided to gain market share in Spartan and hold off on entering Flash because there is not a lot of information on the market.

3. STRATEGY – Period 1-3
Segmentation & Targeting: Treat at Wright; Trick at Cooper
Doubled initial advertisement spending in Spartan to increase product awareness
R&D in Flash
NO R&D in Period 1 – not enough information available
R&D in Period 2 or 3 based on information from market studies
Launch new product in Sheriff to capture more market share
Perceptual shifts on Trick and Treat
Key milestones
Launch a new product in the new segment (Sheriff) based on existing R&D
Leverage on the ideal attributes of existing R&D with no incremental cost
Do R&D for new product in Flash in Period 3 based on market studies
In Period 2, market studies show that all Flash’s existing segments are small
A new segment is emerging but no information available yet
In Period 3, market sizing information is more clear
Period 2: New product launched in Sheriff based on Trick’s R&D
Period 3: R&D for new product in Flash based on market studies

4. Segmentation decision No.1
Observation: Sheriff emerges in Spartan
Positioning: Trick has similar attributes as Sheriff’s preferences
DECISION: Launch a new product targeting at Sheriff based on Trick’s R&D
SPARTAN Perceptual Map: Period 1
In Period 1, Sheriff emerges in Spartan
Positioning: Trick has similar attributes as Sheriff’s preferences
Decision: launch a new product targeting at Sheriff based on Trick’s R&D
Thoughts: Combined target market approach might work better
 Takeaway #1: Implement appropriate target market approach

5. Effective perceptual shifts Advertisement spending
Outcome – Period 1-3
Optimal product positioning
Leading market share
Effective perceptual shifts
Advertisement spending
Great market awareness

6. Midpoint swot analysis
Strengths
Positioning
Awareness
Budget
Weaknesses
Level of Production
Declining Focus on Perceptions
Opportunities
Good product attributes in Flash
R&D in Spartan to increase profitability
Threats
Competition from Orange team in Spartan
Changes Preferences of Consumers
Strengths
Positioning
Awareness
Weaknesses
Level of Production
Declining Focus on Perceptions
Opportunities
R&D in New and Existing Markets
Capability to capture larger market share
Threats
Competition
Changes Preferences of Consumers
Takeaway #2: Align marketing expenditure and productions
Takeaway #3: Market timing is important

7. Period 4 – 6
MILESTONES
Period 4: New product (Troop) launched in Flash; Treat replaced by new R&D
Period 5: Second product (Trump) launched in Flash
Period 6: Troop and Trump replaced by new R&D (unit production cost lowered by $150)
Strategies
Keep market share in Spartan through advertisement spending and perceptual shifts
Launch new product in Flash in Period 4 with huge advertisement
DO R&D in Spartan to replace Treat by one with lower unit production costs
Launch second product in Flash

8. Segmentation decision No.2
In Period 4, we saw clear discrepancy in price preference between 5 segments Positioning: Troop is at ideal position to capture all segments DECISION: Launch a new product (Trump) targeting at 2 high-price segments; Troop targets at low-price 3 segments
Thoughts: Multiple Target Market Approach works
 Takeaway #1: Implement appropriate target market approach

9. R&D Strategy Over time…
Budget continued to increase #winning #tigerblood
Advertisement effectiveness decreased due to high levels of market awareness
DECISION: DO R&D to lower unit production costs of existing products
In Period 4: Treat is replaced by a new product with $80 lower cost/unit; Only ~$1,000 were spent on R&D
In Period 6: Troop and Trump replaced by new products with $150 lower cost/unit; Only ~$3,500 were spent on R&D
In later periods, we had HUGE budgets
Our products have great market awareness  Advertisement is increasing less effective
R&D costs decreased over time
 Takeaway #4: When there is little market share potential, focus on profitability

10. Cumulative Net Contribution
Outcome
Total Accumulated Net Contributions (Period 1-6):
SABRE-Toothed Tigers: 283,657 (#1 in recitation)
Market Share by Value:
21.4% in Spartan
47.6% in Flash
Cumulative Net Contribution

11. Reflections
SUCCESSES
AREAS of Improvement
Spending on advertisement in Spartan Good timing to enter Flash Successful segmentation strategies
Aligning marketing expenditure and production Perceptual shifts