Suggestions of past Brandmaps companies Essays

Suggestions of past Brandmaps companies Essays Suggestions of past Brandmaps companies Essay Suggestions of past Brandmaps companies Essay one may want to cut a few costs, with a huge cost saver being reducing the warranty and compatibility, especially if the relative importance of that specific attribute within that specific targeted market is not considered important. In the end, having a conducive product which meets the needs of the consumer is the bottom line when taking all new product decision variables into consideration. Introduction of a new product can be quite costly. A wise firm would initially do some prior research as to what activities are taking place within the particular targeted region, including industry growth and potential and other product formulations by competing firms. A firm would not be wise as to introduce a new product into an already over saturated or weak market. Reformulation bids are another testy item which requires intense scrutiny. Using some applicable aspects of game theory, one must anticipate what the competitors are doing in the particular targeted region, as a high Reformulation may be a complete waste of expense. This is where some calculated risk must be made. Introduction of a new product also experiences other divisional expenses which may add up, including the hiring of a sales force. Careful capacity planning should be done ahead of time so in the best possible scenario, a company will have enough capacity to produce all future ordered. In the worst possible scenario, full capacity will not be utilized and it can be sold to recover some of the capacity adding expenses incurred. Capacity planning is a touchy subject which quite frankly requires accurate long term forecasting in order for it to be cost efficient. At times, with the introduction of a new product, some short term pain must be experienced. Quite often, due to the lack of experience curve savings and presence of substantial smoothing effects, the initial cost of the product may be enormous and profit margins may be slim. Along with reformulation, sales force, initial intensive advertising and promotion expenses, there may stand to be little profit gained during an introduction. Negative profits during introduction are not a rare occurrence and a company should not be afraid to experience this. Do not worry, things will probably get better. There are a few more tips a firm can use in order to have a successful introduction of a new product. Our firm found that initial large expenditures in advertising during the roll-out of the new product is necessary for creating awareness of the product. From our advertising experiments we found that spending more money will always increase awareness of a product. If people like this new product, they will buy it. Increasing incentives for the sales force to work harder on selling the product is another feasible technique, such as increasing sales commission or salary. Dealers can initially be pushed to carry the product by providing temporary rebates. One must remember not to give these rebates for too long of a time or they will lose their effectiveness. A firm newly introducing a product must be brave and not scared to lose a bit of money during the first small stretch of existence and should not compromise their price at the expense of generating increased initial sales as this could be detrimental for long term profit. The last very important factor which should be taken into consideration is whether or not the product should be introduced into one or several markets. Our firms advice is that a company should try to create a product that is perfect for one market but can be accepted within others. We found that one of our newly introduced products was perfect for the Pacific market but also was preferred in the Canada market. As sales in the Pacific area shot up, product costs decreased, which lowered the price of the somewhat less suitable but still well-liked product in Canada, making it preferred. Our advice is that a firm should try not to create a product which partially meets the needs of multiple markets or if a firm does, dont expect it to become a grand success as it may end up flopping in all of your targeted markets. Good luck! Sales Forecast A good sales forecast is very important because it helps avoid stockouts on the one hand and high inventory levels on the other. To find out which sales forecast seems to be reasonable for the next term, you should first take a look at industry sales volume forecasts (#31). This study gives an overview of the past and future sales volume for all market regions. As mentioned in the book the study gives an overview, and therefore the major problem is, that it assumes current marketing activities of all firms in the industry to stay at the same level, or to continue their present course, which most often is not the case. Another problem with this study is, that especially when entering a new market the forecasts are often to optimistic. You should take a look at your marketing program and those of rivals. Furthermore one should also consider that the marketing research study # 31 doesnt account for unfilled orders. Consideration should be given to the population growth and the economic figures of the region. A knowledge of the stage for the product life cycle of your product, or the market, and how accepted the product composition is, are all important points of concern. To get information about your brand sales forecast you can use brand sales volume forecast (#32). You can also make your own calculation by multiplying the industry sales forecast with your market share forecast. In general its better to be a conservative in your forecasts. This is because it is better to gain more profits than forecasted than visa versa.