Transcript Cosmo Group I

Cosmo Group I
Meagan Carrow
Xiaodan Dong
Outline
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Analysis of past performance
Main strategies pursued
Main Adjustments
Key Lessons
Recommendations for the Future
Analysis of Performance
• Stock price $2,318
• Retail sales
$1,214,398K
• Cumulative ROI 2.92
• Four segments in
Sonite
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Professional - SIBI
High Earner - SIHO
Others - SIRO/SIRR
Single - SINU
• One segment in Vodite
• Innovator/Early Adopter
-VINO
Main Strategies Pursued
• Target One Segment per Product
• Focus First on High-Margin Groups…
• Professionals/High earners margin $250-$280
• Singles/Others margin $90-$120
• Then Address High-Growth Groups
• Singles & Others
• Keep introducing new products
• Company growth
• Stock price
Adjustments in Sonite Market
• Introduced SIHO for “high earners” in period 3
• Competitors more interested in “professional”
• High R&D investment, high margin, high return
• Introduced SIRR for “others” in period 4
• Inappropriate pricing strategy trashed SIRO
• Disposed SIRO in period 4
• Used a new name to replace SIRO
Sonite Adjustments Continued
• Balanced advertising and sales force in
period 4
• Learned from competitors
• Sales force was shorthanded
• Modified SIBI for “professionals” in period 8
• The oldest product
• Still very profitable
• Transferred some resources to Vodite Market
in period 8
• To have a strong opening
Adjustments in Vodite Market
• Monitored competitors’ R & D expense
• Predicted Team A would promote Vodite product in period 7
• Bought marketing research studies in Vodite market
• Introduced VINO in period 8
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Sonite market growth slowed down
Started PVINO since period 5
Not to be the first mover
Competitive pricing strategy
• Started PVIDO for adopter in period 8
• Higher growth
Key Lessons
• Don’t completely neglect anything…
• But don’t overspend either
• Watch your competitors…
• But remember you can never predict
exactly what they will do
Key Lessons (cont.)
• Use the marketing studies
• Turn the data into information
• Balance your investment into new
products and the maintenance of
existing (successful) products
Recommendations
• Continue to monitor the industry
• Invest in marketing research
• Don’t waste the investment by ignoring the
data
• Enter the Vodite market slowly
• Let another company make the risky
entrance, then use the data provided from
their entrance