Lena McKenna Shannon Michael Ford Nicole Pope

Simulation Game Marketing Strategy Paper

Executive Summary Initially, we selected Outdoor Enthusiast as our target market due to our desired goals

of $60 CM and 200 units. This target not only allowed us to offer a higher purchasing price, but also gave a consistent growth rate. Each element of the marketing mix played a key role in how we played the game, but the price and product were the top two. Our product needed to fit within very specific needs of our consumers and their willingness to pay more for the product allowed us to be more flexible in our asking rate. We tailored our tough and safe messages within various distribution areas to draw consumers in while offering an affordable backpack for their specific outdoor needs.

Due to a few final changes made in an attempt to increase overall profits, we lost a little over a grand which put us tied with ATEAM in round 12.

As a team we ended 4th because we failed to tie the message strategy close enough to our product within the first few rounds. This caused us to play catch-up too far into the game and we struggled to recover as round 12 approached. Overall we feel confident with the choices throughout the game and enjoyed the progress we made through this assignment.

Part I: Segmentation/targeting/positioning

a. Segmentation

Psychographic

Likes to Camp Doesn’t Like to CampNeeds more capacity X College Students

Luxury

Doesn’t need as much capacity

Kids Commuters

Bene

fit

We chose the Outdoor Enthusiasts due to their unique demand for high capacity and outdoor interests. Due to these demands our message strategy focused around the benefit of maximum capacity and psychographic desire to camp. Our top features were the high capacity of the backpack and the waterproofing feature for high durability.

b. Targeting Due to our goal of having a $60 contribution margin, we chose Outdoor Enthusiasts because of their willingness to pay. Our sales goal was to sell 200 units per quarter, and by targeting Outdoor Enthusiasts, we had a better opportunity of reaching this goal. Rounds one through five consistently maintained a $66 contribution margin. During rounds six through twelve, our contribution margin was $60. In round two our units sold was 61 per quarter which jumped to 368 units per quarter by the end of the game. In conclusion, we believe that choosing Outdoor Enthusiasts was the correct choice due to the size of the market, their willingness to pay, and the specific credentials for their desired product.

c. Positioning Outdoor Enthusiasts More Tough

- Last Standing: This group targeted outdoor enthusiast and college students so we placed them in the top right quadrant to resemble their toughness and reasonably high performance. Last Standing was one of our top competitors.

- A Team: Also targeting the outdoor enthusiast and representing one of our top competitors as well.

Lower

Performance

Higher

Performanc

e

Less Tough

- Troy Taylor: Due to the fact that Troy’s target market was school children led us to place him at the position he is at. Though toughness could possibly be a message that caters to school children, having a high peak performance was not one of them. His message favored the term funky.

- Intrepids: The target segment for this group were the university students. Being university students ourselves, having a backpack with toughness is important because of the textbooks we have to carry. Peak performance on the other hand, does not play much of a factor.

- Risky Business: By targeting the urban commuters, this group focused their message on “classic.” Classic does not have heavy emphasis on toughness or high performance which is why we have placed it lower than our other competitors.

- Almost Done: We are positioned in this area because we feel our product that we created hits heavily on both toughness and peak performance.

Part II: Product Strategy/Promotion Strategy/Pricing Strategy/Distribution Strategy

a. Product Strategy Like previously mentioned, our target segment was Outdoor Enthusiasts. Out of the five characteristics, the main ones that catered to Outdoor Enthusiasts were: Capacity and waterproof (both at 83%), and durability at 41%. In order to meet these needs, we first started off by developing a large rectangular capacity size backpack. This gave the Outdoor Enthusiasts plenty of room to carry their belongings.

Next were the straps. We selected wide padded straps because not only did they give comfort and durability, but they were also cost efficient.

When it came to the features, we first added waterproofing in round 2. We gave this a trial run to see exactly how it would do and it didn’t meet our expectations. Round 6, we decided to add a Solar Device. This made a huge jump in units sold for in round 5 we sold 184 units and in round 6, we sold 239. The features were a hit.

Because we wanted to help keep our production costs down, we went with the Synthetic material. This material not only was $1 for production cost, but it also scored a 6 in waterproof. After this, we chose green for our color to differentiate from our competitors.

Our competitors targeting the same segment, ATEAM and Last Standing, all of us went with the color green. In terms of our product, we believe ours was more superior for several a couple key reasons. First off, in round 2, we were the ones to turn our backpack green—differentiating us from our key competitors. Last Standing converted to the color green in round 7 and ATEAM did so in round 6. Secondly, we went with wide padded straps in round 1 while Last Standing changed theirs to wide pad in round 6. Like us, ATEAM also went with wide padded straps from the get go. Though very similar, our product was still inferior to those of our competitors. Promotion Strategy

Characteristics Scores

Last Standing

Troy Taylor

RiskyBusiness ATEAM Intrepids Almost Done

R1-93 77 73 84 93 68

R2-93 77 73 86 93 66

R3-93 77 73 86 80 66

R4-93 77 73 86 80 66

R5-93 77 80 86 78 66

R6-43 77 80 86 78 69

R7-66 77 80 86 78 69

R8-66 77 80 86 78 69

R9-66 77 73 86 78 69

R10-66 77 80 86 78 69

R11-66 77 80 86 78 69

R12-66 77 80 86 78 69

Features Score

Last Standing

Troy Taylor

RiskyBusiness ATEAM Intrepids Almost Done

R1-0 9 0 0 0 0

R2-9 9 0 0 0 9

R3-9 9 0 0 0 9

R4-9 9 0 0 0 9

R5-9 9 0 0 0 9

R6-0 9 0 9 0 9

R7-9 9 0 9 0 9

R8-9 0 0 9 0 9

R9-9 0 0 9 0 9

R10-9 0 0 9 0 9

R11-9 0 0 9 0 9

R12-9 0 0 9 0 9

In regards to the characteristic score, we initially started off with a high number, but after round 1 we made some changes in media and our product which caused our score to fall. The feedback round helped us understand how our characteristics benefitted, so we made some additional changes and our score exceeded the original from round 1.

When first assembling our product we focused on the material to replace our features which caused our score to start at zero. Once we understand the demands of the consumers we added additional features that fit their needs. Our score jumped to 9 and stayed constant for the remainder of the rounds.

When first creating our product we focused our features and design around our target’s need; Outdoor Enthusiast. They desired a backpack with large capacity, durable, and eco-friendly, which is why we designed our pack with a large shape, wide padded straps, and an earthy green color. From there we chose additive features to improve our pack; these include a solar device and waterproofing features to endure the outdoor elements. The final feature focused around the material, synthetic, to reassure our consumers on the durability of the pack.

b. Promotion Strategy: MessagePeak performance, safe, and tough were a part of our message strategy for Outdoor

Enthusiasts because being outdoors requires a backpack such as this. Due to the fact that they could possibly be in incrementing weather, they would need a backpack that was tough and could stand any weather. Also, with dealing with the outdoors, they would need a backpack with peak performance that meets their durability, capacity, and waterproof needs. According to our key competitors, ATEAM and Last Standing, our product was more superior because we included tough along with peak performance.

Large rectangular

Green

Wide padded straps

Safe

Tough

Peak Performance Synthetic

Waterproofing Solar Device

Both ATEAM and Last Standing, had peak performance, but with us including tough, it gave us a perspective of how Outdoor Enthusiasts think.

Message Scores

Last Standing

Troy Taylor

RiskyBusiness ATEAM Intrepids Almost Done

R1-0 8 5 15 15 15

R2-12 7 4 15 10 7

R3-10 9.6 6 15 15 8

R4-12 21 7 15 15 8

R5-14 15 12.8 18 18 9.6

R6-0 19.2 8 25.2 22.4 9.8

R7-7 19 9.6 28 24 11.2

R8-8.4 4 11.2 28 27 12.6

R9-9.9 4.8 8 28 30 28

R10-11.2 5.6 5 28 30 12

R11-12.6 6.4 6 28 30 12

R12-14 7.2 7 28 30 14.4

From the beginning we targeted peak performance as the message strategy, and throughout the rounds worked with different words to understand different reactions, which is why we fluctuated scores. Round 9 was our largest score due to the addition of tough as a message, but when we added safe our score dropped. c. Promotion Strategy: Media

Our interest score didn’t see major fluctuations, until round 6 through round 8. At that point in the game we were shifting our message strategy and adjusted our media interests. By round 9 we were back up to a higher interest score.

Interest Scores

Last Standing

Troy Taylor

RiskyBusiness ATEAM Intrepids Almost Done

R1-18 18 18 18 18 18

R2-16 17 16 16 16 16

R3-15 16 14 16 14 15

R4-15 18 13 17 14 14

R5-14 19 13 20 13 13

R6-13 20 12 23 12 12

R7-9 19 12 24 12 12

R8-8 18 13 25 12 12

R9-8 17 13 25 13 15

R10-7 17 12 26 14 15

R11-7 16 12 26 14 16

R12-6 16 12 27 14 17

ROI

Round 10 Round 11 Total CM=$60Media $5,050.01 $7,050.01 = $2,000 480

Total Units 311 319 8 units 8x60=480 -2000=-$1,520 ROI

Starting in round 1, we wanted to add a media outlet to start the game with an increase in coverage. Since we were targeting the outdoor enthusiast it made sense to add the outdoor magazine with a single rotation to start. With increases in sales and outreach, in addition to a sales promotion for radio outlets we expanded our media in round 3 with radio sports. Throughout the remainder of the rounds we made small adjustments such as: addition of gym posters and top 40 radio, as well as taking away radio sports. The largest media we added was on round 11 with Wilderness TV.

d. Pricing Strategy Price Score Due to the specificity of the product and the narrow target market we were able to charge a higher price and stretch the consumer’s price elasticity. We focused more on the message attached to the product than the actual price, so after initially setting the product and the price we maintained a consistent price score of 3 throughout the remainder of the rounds.

Last Standing

Troy Taylor

RiskyBusiness ATEAM Intrepids Almost Done

R1-3 3 4 3 2 3

R2-3 3 4 3 2 3

R3-3 3 4 3 3 3

R4-3 3 4 3 2 3

R5-3 3 3 3 1 3

R6-4 3 3 3 2 3

R7-3 3 3 3 2 3

R8-3 4 3 3 2 3

R9-3 4 3 3 2 3

R10-3 4 3 3 2 3

R11-3 4 3 3 2 3

R12-3 4 3 3 2 3

Cost Competition

Last Standing

ATEAM Almost Done

R1 - $14.00 $40.00 $28.00

R2 - $12.00 $48.00 $34.00

R3 - $12.00 $48.00 $34.00

R4 - $14.00 $48.00 $34.00

R5 - $14.00 $48.00 $34.00

R6 - $34.00 $48.00 $44.00

R7 - $34.00 $48.00 $44.00

R8 - $34.00 $48.00 $44.00

R9 - $34.00 $48.00 $44.00

R10 - $34.00

$48.00 $44.00

R11 - $34.00

$48.00 $44.00

R12 - $34.00

$48.00 $44.00

From the beginning we all started with a lower unit cost, but as we began to gain more information on the needs and demands from the consumers regarding the product, we slowly began to raise our prices. By round 6 all three of us had a grasp on the unit cost to best fit our individual products and goals. For our group we had a contribution margin of $60; from the beginning we knew we’d need to have a higher purchasing price and unit price to fit our needs.

Our group didn’t specifically look at our competitor’s pricing strategy to determine our asking price, but instead looked into the feedback of our consumers to determine if the unit price was fair or too high. Once the game neared the end we took a peak at what our competitors were doing and realized we had a higher unit price, but also had a higher unit cost. Between the three players involved in outdoor enthusiast we all remained in similar realms for our unit price and unit cost. Unit Price

Last Standing

ATEAM Almost Done

R1 - $50.00 $120.00 $95.00

R2 - $32.00 $120.00 $100.00

R3 - $32.00 $90.00 $100.00

R4 - $32.00 $90.00 $100.00

R5 - $36.00 $90.00 $100.00

R6 - $83.00 $95.00 $104.00

R7 - $83.00 $95.00 $104.00

R8 - $85.00 $95.00 $104.00

R9 - $85.00 $95.00 $104.00

R10 - $85.00

$99.00 $104.00

R11 - $85.00

$99.00 $104.00

R12 - $85.00

$99.00 $104.00

Because of our smaller, more precise target market, we didn’t feel like skimming or penetration would’ve interested or encouraged purchases of our product. Status quo maintained growth in units sold while still appealed to the consumer’s specific needs.

e. Distribution Strategy Our main focus was on two of the three distribution strategies: selective and exclusive because of the specificity of our product, but the direct distribution was a convenient choice which falls under intensive. Our exclusive distribution center was the outdoor store, while we chose the

department store and the online discount retailer as our selective choices. We expanded our choices throughout the course of the game because of our desire to reach maximum consumers.

Round 11 Round 12 Total CM=$60Discount $0 $500 = $500

Total Units 319 368 49 units 49x60=2940 2940-500=$2,440 ROI

Part III: Emphasis and Allocation a. How You Played the Game

In order to maintain the initial $10,000 dollar budget, we set our price for our product higher than our competitors. By increasing the price and keeping the unit cost low we were able to sustain a continued profit while also promoting and distributing our product into different avenues. The best ROI we found was between round 4 and round 5; round 4 we had a net profit of $2,311.33 and made a distribution deal with the Department Store. Following the next round we had a spike of $3,470.33 as our net profit which marked the best ROI during the entire game.

b. Results

Last Standing ATEAM Almost Done

R12 - $14,747 $8, 040.82 $19,716.19

In an urgent, slightly spontaneous decision we added a sales promotion within the Department Store. After losing profits in round 11 we were hoping to regain it in round 12, but ended up losing more.

If we could go back and repeat the game we’d focus on tying our message to our product and creating a clear understanding of what we wanted to gain throughout the rounds. We failed to tie the message strategy close enough to our product within the first few rounds and it caused us to play catch-up too far into the game, but overall we felt confident with our overall choices and progress during the game.