dorfman designs - waldesq emilia balke yoav bardov kiran dsouza helena lam zahid sultan

Dorfman Designs - Waldesq

Emilia BalkeYoav BardovKiran DSouzaHelena LamZahid Sultan

Macro Environments

Competitive Situation

Distribution Situation

SWOT

Critical Success Factors

Introduction Marketing Objectives

Marketing Strategy

Marketing Mix

Schedule & Conclusion

DemographicsBaby Boomers =

Rural Cities Changing furniture needs

EconomicsGlobalization Outsourcing Overseas Manufacturing

TechnologicalInternet = More information, global purchasing/shipping, increased technology transfer

Macro-Environment Situation

Political / LegalIncreased activity with regional craft-industry alliance groups

Social / CulturalDomestic tastes turn international

• Asian & European-influenced styles• Ideal for space-saving furniture designs

Macro-Environment Situation

Market Situation

Wood furniture industry demand growing Increase in remodeling New home construction Rise in space-challenged city dwellers

More sales occur in 2nd half of year 2006 sales have slowed

Competitive Situation – High End

Counselor's desk Drop Lid Desk

Elegant design Foldable topTwo pigeon holesTwo secret pencil drawers

Highly functionalHigh qualityWork surface drop lid

$2,569 $1,499

Competitive Situation – Middle Market

eNook The Mobiletech Mobile Desk

Lyon 2253 - Wall Desk

Elegant designCan hold 45 lbsSpace efficient Highly functional

Can fit in most rooms and offices

MobileScratch & stain

resist

Weighs only 30.5 lbs.Strong Lift top compartment

$400-$450 $169.99 $229

Competitive Situation – Mass Market

Adjustable Folding Table leaning wall shelf with desktop

Height adjustableLightweight Folds flatStain resistant

Mobile – shelf rests and is not attached to wall

no skills requiredAdditional accessories available

$59.99 $36.28

Impact on Dorfman Design & Waldesq

Lack of capital & market share

No existing brand name

Competitors’ products manufactured overseas

Competitors strong position decreases industry attractiveness

First mover advantage

sophisticated mechanism, high quality, and upscale design – hard to copy

No product encompasses all Waldesq attributes

growing demand for space saving furniture

Distribution Situation

Distribution

Channels of Distribution

Furniture Retailers

Buying Groups

Distribution Trends

Chain StoresLocal StoresOutletsDisc. StoresReps

Rooms-to-goEthan Allen Levitz IKEA La-Z-Boy

Furniture First

increasingly fragmented

Internet Sales

SWOT

Stre

ng

ths

Weakn

esses

Op

portu

nitie

s

Th

reats

Unique, differentiated products High Quality, elegant and durable products.Multifunctional usage products, broad appeal to different market segments.Ongoing product improvement

No brand identity Lack of capital Lack of manufacturing

capabilities

First mover advantageExpanding to other target

market segmentsProcess improvements

(technological innovation)

Imitation of Competitors Seasonal Demand Lack of financial backing

Critical Success Factors

Identify correct market niche First mover & what’s next Excellence in quality and function Ease of revision to address changing style

trends Solid and substantial financial backing for

manufacturing

Alternatives Strategies

The Think Tank Strategy The Expert Maker Strategy The Sell Strategy The Total Control Strategy The Inventor Strategy

The Think Tank Strategy Sell entire design to another company

Pros All profit realized at

once

Little follow up required

Less capital needed

Buyer will file for patent

Cons Very little creative

control

Focus on function instead of styling

Will not benefit from units sold

The Expert Maker Strategy Focus on manufacturing. Leave selling to

retailers

Pros Retain all creative control

Profit margin determined in-house

Choice of market segment

Cons Requires a large pool of

capital resources Intricate design is labor

intensive and costly. Challenge to locate

domestic manufacturer No guarantee that

retailers will pick this up

The Sell Strategy Dorfman acts as retailer, leaving the

production to a furniture manufacturer.

Pros Margin is made at retail

level, paying furniture manufacturer a set unit cost

Focus on selling to chosen market segment

Headache of making the item can be avoided

Cons Investment in retail space

At the whim of uncontrollable circumstances

Constant work required

Less input into the end product

The Total Control Strategy

Both making & selling

Pros Total control of end

product function & design Total control of targeting

market segment Vertical chain margins are

increased Channel open for further

product launches

Cons Investment in retail space At the whim of uncontrollable

circumstances Constant work required Labor intensive Has the most capital

requirements out of all alternatives

Recommendation: The Inventor Strategy

License the Waldesq design

Pros Low capital requirements Little follow up while

license is active Several ways to profit:

upfront, guarantees, option agreements, royalties

Able to resell design later

Cons Little creative input outside of

patented details Need to maintain patent to

retail license contract value Additional work after license

expires

Marketing Objectives

PRODUCT Blue prints – June, 2007

Price 1. $450-$550

2. Volume discount and wholesale pricing

Distribution

1. Distribution channels

2. Market coverage – selective

3. Volume – 100 units

Promotion 1. "pull" selling strategy

2. Advertising –furniture magazines, newspapers, internet furniture website

Segments and Targets Analysis Geographic Segmentation

Demographic Segmentation

Psychographic Segmentation

Geographic Segmentation

Young Digerati Couples or single headed house holds mostly with kids Live in urban areas In mid 20s with Masters Degrees and technically savvy.

Baby Boomers Upper middle class home owners in their forties and fifties

with college education, still raising kids. Live in suburban areas with kid centered life style

College Towns Lives in limited living spaces such as dormitories or shared

accommodations in college towns

Demographic Segmentation Income

Middle and High income groups

Life Stage Newly weds and people deciding to move in to live

together

Social Class Upper middle class and upper class consumers

Psychographic Segmentation Innovators

Often purchase upscale, niche oriented products

Thinkers Favors durability, functionality and value in products

Achievers Goal-oriented people who focus on career and family

Experiencers Young, enthusiastic, impulsive people, who seek variety and

excitement

Recommended Marketing Strategy

Concentrated Marketing Strategy

Firm develops and markets for a very well-defined, specific segment of the consumer population.

Target markets are different from one another

Particularly effective for small companies with limited resources, because no need for mass production , mass distribution and mass advertising.

Positioning Space Saving

Living space is at a premium for most of the target market

Multi-functional and Convenience Serves multiple functions such as : writing table, break fast

nook, TV stand, work station etc

High Quality Waldesq made of real wood, aesthetically pleasing and no

close competitor

Marketing Mix - Product Description:

Unique Sleek Design Functional

Materials and colors: Maple Medium cherry

Product Features: high quality wood durability ease of installation

Branding: Message: “Space-saving high

quality furniture with style.” Brass plate “Waldesq by

Dorfman Designs.”

Marketing Mix - Product Augmented Product:

Enhance product (i.e. technical support, repair services)

Offer product hot line Capture customer data Commit to improving existing

products Provide a web forum Offer mailing list & promotional

offers

Marketing Mix - Price Price:

$450-$550 Upscale stores may

not be interested Launch in medium

range market Preserve position

even if copied

Marketing Mix - Place Pilot launch:

Pilot launch of 100 desks

Production cost - $100 per unit

Give idea of market acceptance

Internet Sale: Reach potential large customer

segment – mail catalogues, internet sales

Maintain price to avoid undermining physical store sales

Caution:Increasing e-commerce sales, may affect

first mover advantage

Marketing Mix - Promotion Capture attention:

“Innovators are venturesome“

Target university students and recent graduates

Message: Deliver creative, functional, stylish,

high quality space-saving product. Be open to its customer’s changing

needs

Focus: Focus on meeting customer needs

Use of media: Airline Journals Home Decoration Magazines Recreational Vehicles

Catalogues Furniture Retailer Catalogue

Personal Selling

DEPARTMENTAGENTTASK(S)OBJECTIVESTIMELINEComments

Product ManagementProduct ManagerAcquire Pending Patents

To protect Waldesq’s unique design from copying

June, 2007

Product ManagementProduct ManagerDevelop Blueprints for Waldesq production

For mass production

June, 2007

Product ManagementProduct ManagerLicensing the Waldesq to other manufacturers

For mass production and distribution

August, 2007Assuming that, it takes 2 months to find a potential licensee.

Operations Management

Production Manager

Manufacturing of Waldesq

For distribution through retail stores

February, 2008Typically, it takes around 6 months to organize manufacturing activities.

Sales ManagementSales ManagerDistribution of Waldesq to retail stores

Sell the product to consumers

April, 2008On an average, it takes around 45 days to ship to the retailers.

Sales ManagementSales ManagerPromotion of Waldesq

Sell the product to consumers

April, 2008

Scheduling