Hands-On Product Feasibility Analysis

Group 2:

Valerie- MA1N0220David- MA1N0219Bảo Bảo- MA1N0230Amos- MA0N0241

IntroductionIn mid 2006, Scott Dunlap and his wife went to mall. His

wife needed to find boots on magazine, and she found it from store to store. Dunlap is a man and not shopper, he wanted out of there. He thought “why isn’t there a search engine for malls where shoppers can go online to see if a product is available and where is cheapest?

NearbyNowFrom the industry feasibility analysis side, one thing

that was heartening to Dunlap was signs that although people like to search and do price comparisons online, they prefer to shop offline so they can touch and feel a product especially for higher-priced items. While online sales are climbing, shoppers still like to be able to feel and touch their products. especially clothes and shoes, before they buy

From that idea, the venture NearbyNow was born

NearbyNowNearbyNow is presently in about 200 malls, was with 50

percent of US consumers within 30 miles of a NearbyNow enabled mall.

The company has captured the attention of several strong advocates.

In April 2008, it raised a fresh round of $11.75 million in funding, which raised its total to $19.25 million since 2006.

Q1: Write a concept statement for NearbyNow. If NearbyNow was still in the star up stage and Scott Dunlap asked you who he should distribute the concept statement to, what would you have told him?

NearbyNow takes the shopping experience to a whole new level by allowing shoppers to compare prices and find out the availability of the product that they are looking for in stores right at their fingertips, making it a hassle free experience for all shoppers

Q1: Write a concept statement for NearbyNow. If NearbyNow was still in the star up stage and Scott Dunlap asked you who he should distribute the concept statement to, what would you have told him?

If NearbyNow was still in its start-up stage, he need to distribute his concept statement to the group that would benefit from this concept the most:

Shoppers and shopping center executives for shoppers, the selling point is that their shopping experience will be more convenient.

Since NearbyNow somehow provides a shopping database, making it easier to search for product and at the same time, compare prices.

For shopping center executives, it would help them increase sales depending on the number of visitors and from there, deriving the number of customers who actually buy from the store visited by those customers.

It is actually a win-win situation for everybody

Dunlap’s Gum shoe researchQ2: What types of gumshoe research did Dunlap benefit from, and what additional gumshoe research could he have conducted while he was investigating the feasibility of NearbuyNow?• A gumshoe is a detective or an investigator that scrounges around for information or clues wherever they can be found.

Dunlap’s Gum shoe researchShared idea with colleagues at workTalked to shoppers, retailers and mall

managers about how to use internet to enhance the retail experience

Talked to >2000 people , some focus groups, some one-on-one “whether people really wanted NearbyNow services”

Reading findings of relevant business research articles, e.g. 2007 study article by National Retail Federation and Forrester Research

Dunlap’s Gum shoe researchSit on a stool @ local mall, next to mall

directory, figured out which store customers were going to. “can I help you..? Tell me if ….? Raffle draw…..$500 gift Certificate”

Additional Gum shoe research….finding out about system o taking

inventory in different stores …….

Q3: Did you know that the majority of malls in the US are owned by 6 companies? If not, how might you have discovered this information if you were conducting a feasibility analysis for a product or service that would be placed in malls?Note: 90% of malls in US are owned by 6 companies (

persuading 1 company might lead to having the service in the majority of malls)

No we did not knowOnline research about the ownership

structure of US mallsDiscussion with some of the shopping mall

managers

Q4: Complete a First Screen analysis for NearbyNow. What do you learn from the analysis?Part 1: Strength of Business Idea

Low Potential (-1) Moderate Potential (0) High Potential (+1)

1. Extent to which the idea: Takes advantage of an environmental

trend Solves a problem Addresses an unfilled gap in the

marketplace

Weak Moderate Strong (+1)

2. Timeliness of entry to market Not timely Moderately timely (0)

Very timely

3. Extent to which the idea “adds value” for its buyer or end user

Low Medium High (+1)

4. Extent to which the customer is satisfied by competing products that are already available

Very satisfied Moderately satisfied Not very satisfied or ambivalent (+1)

5. Degree to which the idea requires customers to change their basic practices or behaviors

Substantial changes required

Moderate changes required

Small to no changes required (+1)

Point of view in 2006

• Part 2: Industry-Related IssuesLow Potential (-1) Moderate Potential (0) High Potential (+1)

1. Number of competitors Many Few None (+1)

2. Stage of industry life cycle Maturity phase or decline phase

Growth phase (0) Emergence phase

3. Growth rate of industry Little or no growth Moderate growth Strong growth (+1)

4. Importance of industry’s products and/or services to customers

“Ambivalent” “Would like to have” (0)

“Must have”

5. Industry operating margins Low (-1) Moderate High

Point of view in 2006

• Part 3: Target Market and Customer-Related Issues Low Potential (-1) Moderate Potential (0) High Potential (+1)

1. Identification of target market for the proposed new venture

Difficult to identify May be able to identify Identified (+1)

2. Ability to create “barriers to entry” for potential competitors

Unable to create May or may not be able to create (0)

Can create (+1)

3. Purchasing power of customers Low Moderate High (+1)

4. Ease of making customers aware of the new product or service

Low Moderate High (+1)

5. Growth potential of target market Low Moderate (0) High

Point of view in 2006

• Part 4: Founder- (or Founders-) Related Issues

Low Potential (-1) Moderate Potential (0) High Potential (+1)

1. Founder or founders experience in the industry

No experience Moderate experience (0) new ventures in online businesses

Experienced

2. Founder or founders skills as they relate to the proposed new venture’s product or service

No skills Moderate skills (0)

Skilled

3. Extent of the founder or founders professional and social networks in the relevant industry

None (-1) Moderate Extensive

4. Extent to which the proposed new venture meets the founder or founders personal goals and aspirations

Weak Moderate (0) Strong

5. Likelihood that a team can be put together to launch and grow the new venture

Unlikely Moderately likely Very likely (+1)

Point of view in 2006

• Part 5: Financial IssuesLow Potential (-1) Moderate Potential (0) High Potential (+1)

1. Initial capital investment High Moderate (0) Low

2. Number of revenue drivers (ways in which the company makes money)

One Two to three (0) web ad and revenue sharing

More than three

3. Time to break even More than two years One to two years (0) Less than one year

4. Financial performance of similar businesses Weak Modest Strong (+1)

5. Ability to fund initial product (or service) development and/or initial startup expenses from personal funds or via bootstrapping

Low Moderate High (+1)

Point of view in 2006

Overall Potential Each part has five items. Scores will range from -5 to +5 for each part. The

score is a guide—there is no established rule-of-thumb for the numerical score that equates to high potential, moderate potential, or low potential for each part. The ranking is a judgment call.

Score(-5 to +1)

Overall Potential of the Business Idea Based on Each Part

Suggestions for Improving the Potential

Part 1:Strength of Business Idea

4 HIGH POTENTIAL

Part 2:Industry-Related Issues 1 HIGH POTENTIAL Short work experience in

shopping mall management

Part 3:Target Market and Customer-Related Issues

4 HIGH POTENTIAL

Part 4:Founder- (or Founders-) Related Issues

-1 LOW POTENTIAL Short work experience in shopping mall management

Part 5: Financial Issues 2 HIGH POTENTIAL

Overall Assessment10 HIGH POTENTIAL

Point of view in 2006

Summary—briefly summarize your justification for your overall assessment:

First screen analysis shows us that the business idea has high potential

Has 1 possible bottlenecks:

Founder related issues: founders could develop more contact and social networks in shopping mall business (participate in different business events, shopping malls opening) and meet important contacts. Or use professional online social networks (e.g. LinkedIn)

By focusing on this 1 bottleneck, NearbyNow can develop a successful business since the crucial part (finance) are sufficient to spread this service by recruiting talented employees.

Q4: What do you learn from the analysis?This easy tool enables us to quickly

evaluate all the necessary parts of a successful start-up and help us decide:if to move forward or develop some part (industry related,

financial or other) more or go for another idea

NearbyNow today…is something else