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Marketing 3300 Project Proposal

“No More Raining on My Parade”

Team #10

April 28, 2016

Andrea Cabral Mei Yi Lok

Hassan Zafar Melissa Zhang

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Executive Summary

For glasses users, walking through the wind, rain, and snow can be a daunting task. Our vision fogs up or blurs with every raindrop and snowflake that lands on our glasses. To fix this problem, we introduce our product, wEYEpers. wEYEpers will be one of the first leading glasses wiper accessories for inclement weather, such as rain or snow. This product will incorporate bluetooth technology with smart design to produce an efficient means of clearing vision. Targeted Customers: ● Middle- to upper-class, commuting, college-aged females under 30 in urban areas that

rain/snow the majority of the year. ● Middle-class, active, college-aged millennials in urban rain-dense areas that rain/snow

the majority of the year. ● 30-50 year old, upper-middle class commuters in urban areas that rain/snow the majority

of the year. SWOT Analysis: ● Strengths: Our product is unique, and one of the first of its kind. ● Weaknesses: No similar product in the market means higher risks being the first pioneer.

Later competition can learn from our experiences and strategies. ● Opportunities: Partnerships with retailers, such as Luxottica. ● Threats: We face potential threat from imitation among competition.

Pricing:

$60 for a pair of wEYEpers, which includes a one-year limited warranty, instructions and a safety guide, as well as a 30-day money back guarantee for hesitant customers. Overall Marketing Plan:

For our one year marketing plan, we place a large emphasis on social media and will promote our product through networks such as Twitter, Instagram, Facebook, YouTube, and Snapchat. At our grand opening, we will put up demo displays in store to attract customers and generate demand. Three months in, we will release a John Cena advertisement to generate more awareness on social media. Throughout the rest of the year, we will have in-store events and co-op advertising to continue to generate customer interest and demand. We will hold a charity event throughout November and December by raising money to pay for eye exams and glasses to families and children of need. Goals: Our goals are to manufacture 100,000 pairs of wEYEpers during the first year of operation, learn how to reduce manufacturing costs, and establish our brand as a luxurious item.

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Product It doesn’t rain much in Texas, but when it does, it’s frustrating to walk in the rain while

wearing glasses. The raindrops obscure your vision, and even when you get inside a building and clean your glasses with your shirt, there are streaks all over the lenses, making it difficult to see. We want to create stylish, trendy, and efficient wipers for commuters and active people under 30 who wear glasses.

Our product is mini windshield wipers for glasses, operated by small, discrete lithium-ion batteries called wEYEpers. These wipers will clip onto glasses as an easy and convenient way to clear the rain. The size of our wipers enable portability so they can be carried around with ease. Our wEYEpers are adjustable because we know glasses come in all shapes and sizes. wEYEpers will also feature bluetooth connectivity to sync and create a smooth experience for our users.

Not everybody enjoys wearing contacts, so we want to create a product that combats the exasperation of walking in the rain or snow with glasses.

For commuters under 30 years of age, wEYEpers will wipe the rain from your glasses.

wEYEpers is operated by discrete lithium-ion batteries and sync together using bluetooth technology. Our unique glasses add-on accessory promises to combat weather that rains (or snows) on your parade.

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Industry Overview The total amount of eyewear sold in the United States has increased every year since

2009, which includes contact lenses, over-the-counter reading glasses, prescription eyeglasses, and plano sunglasses.

According to Grand View Research’s 2014 market analysis report on eyewear, the global

eyewear market size was 2.83 million units in 2013. Spectacle lenses and frames accounted for roughly half of those shipments. The report also states that North America absolutely ruled the global eyewear industry, with approximately 189 million units sold in the region. As a result, the North American eyewear market was the largest regional industry in 2013, accounting for over 30% of the overall consumption.

The chart below shows the projected eyewear market from 2012-2020. While these projections are for Europe, we can expect similar growth in many other parts of the world, such as the U.S., India, or China. By 2020, the eyewear market is predicted to reach $142 billion USD.

Europe Eyewear Market, By Product, 2012-2020, (Million Units)

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In 2014, Luxottica was the leading optical retailer in the US, just barely passing Vision Source for the number 1 spot. Luxottica sold 2,291 units and made $2.318 billion in revenue. Vision Source, Wal-Mart, National Vision, and Visionworks, respectively, are ranked below

Luxottica. Luxottica owns Persol and Ray-Ban, and also possesses licenses to produce Chanel, Michael Kors, Prada, Oakley, Versace, and other name-brand eyewear. Luxottica also owns the Sunglass Hut retail store. Impacting Trends Economic: The total amount of eyewear sold in the United States has increased every year since 2009. The eyewear market exceeded 2.75 billion units in 2012, and continues to grow at a compound annual growth rate of 3.2% through 2018. Technological: Over time, technology becomes easier and cheaper to access. You can purchase sub-par tablets for as little as $34.98 at retail stores such as Wal-Mart. Increased exposure and use of electronics, whether it’s for work or personal use, have been linked to cause dehydration of the eyes. Prolonged dehydration can lead to the need for eye care products, including prescription glasses.

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Competitive: There are not any similar products to wEYEpers in the market, so we currently do not have any competition. However, the increase in population that uses contact lenses instead of the traditional eyeglasses could be a potential competitive factor. Social: An increasing amount of young people are sporting plano, or nonprescription, glasses as fashion accessories. Plano sunglasses are just as popular, as they are expected to grow at a compound annual growth rate of 8.1% through 2018. The demand for high-end plano sunglasses has led to high revenue generation. Regulatory: We would need to protect our product from being replicated by applying for a patent. There was a 31% increase in patent applications in 2014. We would also provide a warning about the safety use of wEYEpers to prevent any liabilities.

Competitive Analysis As of 2016, there is not a single product that is even remotely similar to wEYEpers. This mere fact poses as both strength and a weakness. Creating this unique product serves to our benefit because we’ll have no competitors to try to lure our customers toward their rival product.

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Our company will potentially have competitive leverage, as well as yielding greater profitability. Additionally, by the time our product is out on the market, we will have gone through extensive trial and error to create a quality, resourceful, cost-saving product. Other competitors will have to endure months of research, planning, product development, and more. We get the advantage of having at least a quarter to ourselves until competitors release their own version of wEYEpers. Applying for a patent for our product can also ward off competitors from recreating wEYEpers. A patent will be able to serve as a barrier-to-entry for other companies interested in producing a similar product. This is especially beneficial for high-tech products, such as virtual reality headsets, driverless cars, etc, but can be helpful for us as well. Our product only requires a plastic casing, lithium-ion battery, a bluetooth receiver, and wipers in order to operate. This product is so small and consists of limited parts, which creates little opportunities for competitors to create wEYEpers differently. On the other hand, being the first mover means that we have to be beyond prepared to meet unexpected demand, in case we experience a shortage, much like Poo-Pourri did during their inception. The last thing we want is to make our customers wait until we receive more inventory. We do not want to create frustration and tension to our customers. Lastly, the greatest risk we possess is the lack of precedence; our job is to create a brand new product, which has no competitors, establish and reach a potential market to cater to, undergo extensive research and development to create the best version of wEYEpers that we can, and pave our own path to industry success. With no existing similar products to reference, we are on our own in bringing wEYEpers to life and taking our customers by storm. Luxottica currently stands as the leading optical retailer in the United States, and has for the past couple of years. Vision Source is barely in second place, and Wal-Mart comes in third place, but all three retailers have been neck-and-neck for a long period of time. We’d like to establish an exclusive partnership with Luxottica because they carry the most recognizable name-brand glasses, including Prada, Ray-Ban, Armani, and Oakley. People are already paying a considerable amount of money these high-end brands, and wEYEpers can protect their investment from the horrors of rain. Customer Analysis

The Consumer Electronics Association (CEA) has reported that the “total sales of consumer electronics (CE) accessories … will continue to rise in 2014”. The CEA has projected sales up to $8.5 billion for 2014, and is expecting continued growth. Based on these statistics, we see consumer interest in electronic accessories in growing strong, and we expect high demand for wEYEpers. We feature wEYEpers in glasses retailers to attract and generate interest through related products and bundles.

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We surveyed a group of 20 people, 65% of which were within the ages of 18 and 34. To give some background of the people we surveyed, 35% of respondents are currently pursuing their bachelor’s degree, while 30% already have a bachelor’s degree, and 10% have a graduate degree. 50% of respondents commute to work 4-7 days a week. When asked how often respondents partake in outdoor activities (such as walking, running, sports, attending concerts, etc), 20% answered half of the time, 25% answered most of the time, and 10% answered always. 65% of our respondents heavily rely on glasses, 55% of which use prescription glasses (or regular sunglasses) always, and 10% answered most of the time. On average, 50% of respondents spend $100 - $350 a year on prescription glasses, and 15% spend $350 or more. 45% of respondents admitted that they spend less than $20 on add-ons and accessories for glasses (including sunglass clip-ons, anti-reflective coating, polycarbonate lenses, etc), while 15% spend $20 - $75, and the remaining 40% spend $75 or more on accessories.

We did notice that the three main features that people look for when purchasing glasses

are price, quality, and style. wEYEpers would have to be affordable, built to last, and of course, stylish to meet the needs of our trendy demographic.

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Of the 20 people that we surveyed, 15% were somewhat likely to purchase wEYEpers, and 40% were highly likely to purchase a pair of wEYEpers under the current price of $60. We considered the following groups of people as potential customers of wEYEpers: ● Commuters under 30 years of age ● Active people under 30 years of age ● Middle- to upper-class 30-50 year olds ● Tech-savvy millennials ● Urban commuters ● Northerners, midwesterners (due to snow), and southerners (rainiest part of the country) ● College graduates with at least a bachelor’s degree

54% of 18- to 29-year-olds wear glasses or contacts. This number soars to 90% and

higher after age 49. Additionally, 82% of people with at least a bachelor’s degree need glasses to see, while 68% of people with a high school education or less need glasses.

Regional: Top 10 rainiest cities in the US: Regional: Top 10 snowiest cities in the US:

1. Mobile, Alabama Average Annual Rainfall: 67 inches Average Annual Rainy Days: 59 days

1. Syracuse, New York Average Monthly Snowfall: 110.0 inches

2. Pensacola, Florida Average Annual Rainfall: 65 inches Average Annual Rainy Days: 56 days

2. Erie, Pennsylvania Average Monthly Snowfall: 89.0 inches

3. New Orleans, Louisiana Average Annual Rainfall: 64 inches Average Annual Rainy Days: 56 days

3. Rochester, New York Average Monthly Snowfall: 87.8 inches

4. West Palm Beach, Florida Average Annual Rainfall: 63 inches Average Annual Rainy Days: 58 days

4. Buffalo, New York Average Monthly Snowfall: 82.9 inches

5. Lafayette, Louisiana Average Annual Rainfall: 62 inches Average Annual Rainy Days: 55 days

5. Flagstaff, Arizona Average Monthly Snowfall: 81.7 inches

6. Baton Rouge, Louisiana 6. Utica, New York

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Average Annual Rainfall: 62 inches Average Annual Rainy Days: 56 days

Average Monthly Snowfall: 77.5 inches

7. Miami, Florida Average Annual Rainfall: 62 inches Average Annual Rainy Days: 57 days

8. Grand Rapids, Michigan Average Monthly Snowfall: 65.8 inches

8. Port Arthur, Texas Average Annual Rainfall: 61 inches Average Annual Rainy Days: 51 days

8. Duluth, Minnesota Average Monthly Snowfall: 62.7 inches

9. Tallahassee, Florida Average Annual Rainfall: 61 inches Average Annual Rainy Days: 56 days

9. Cleveland, Ohio Average Monthly Snowfall: 60.3 inches

10. Lake Charles, Louisiana Average Annual Rainfall: 58 inches Average Annual Rainy Days: 50 days

10. South Bend, Indiana Average Monthly Snowfall: 60.0 inches

Target / Segmentation & Positioning Segmentation: ● Demographic:

- Females - Under 30 years of age - Middle aged (approx. 35-64) - Urban residents - Higher level of education - Middle to upper class income

We believe that females will be more likely to buy wEYEpers because women make up 67% of total glasses wearers. Because wEYEpers will be given a chic and tech-savy positioning, we believe younger audiences will be attracted to our product. However, people from age 35-64 show the highest rates of visual loss. wEYEpers is a luxury accessory, so we expect most consumers to be people from the middle to the upper class. ● Geographic: We will focus on places likely to rain or snow, such as Louisiana or Florida

for rain, and New York or Colorado for snow. ● Behavioral:

- Active - Commuters - Tech-savvy

We believe consumers with an active lifestyle or those who commute frequently will have more demand for wEYEpers, because they will spent more of their time outdoors facing potential

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inclement weather. Those who are tech-savy will want to be up to date with the latest technological gadgets, and would be more likely to buy wEYEpers. Targeting: 1. Middle- to upper-class, commuting, college-aged females under 30 in urban areas that rain/snow the majority of the year. 2. Middle-class, active, college-aged millennials in urban rain-dense areas that rain/snow the majority of the year. 3. 30-50 year old, upper-middle class commuters in urban areas that rain/snow the majority of the year. Positioning: We want wEYEpers to be a unique luxury accessory which reflects fashion, style, and quality. Because this product will be used in constant rain or snow, we will position wEYEpers to have a brand of durability and credibility. Our patent will show that we take our brand seriously, and we hold ourselves to high standards. SWOT Analysis Strengths:

- We don’t have any competition because our product is so unique. - Partnering with Luxottica gives us additional access to selling our product at

LensCrafters and Sunglass Hut locations. - Applying for a patent can protect wEYEpers from being replicated, giving us more time

in the industry as the leading and only producers of wipers for glasses. Weaknesses:

- There’s no similar product in the market, so we’ll have to take more risks. - Undergo extensive trial and error to target our market, produce the highest quality version

of wEYEpers, distribute our product, and set the industry standard with no reference. - Second- or late-movers have the advantage of taking note of our techniques and strategies

in order to surpass our success. Opportunities:

- Partner with one specific retailer, Luxottica, as a small company, and then eventually expand to more retailers as we grow.

Threats: - By creating such a unique product, we’re essentially creating and inviting competition.

Pricing

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● Wipers - $3 per wiper ● Lithium battery - $1 per unit ● Casing for battery - $2 ● Bluetooth Receiver - $5

Labor costs are based on the requirements to put together the product in terms of physical

design. Through calculations and research on similar products, the labor costs would range between $5-$10 to attach the battery case to the wiper itself, and enabling the bluetooth feature into the device.

The wEYEpers will be placed into small plastic boxes with the brand name on the front of the box and an instruction/safety guide for the product placed inside as well. The box will contain colors on the outside to represent the brand. The wipers will be enclosed in a plastic sealing for visual appeal. The costs for packaging could range around $1-1.50 per unit. We will be using a facility that already produces other products, rather than building our own manufacturing site. Our product is very inexpensive to produce, so renting a facility exclusively for our product is unresourceful. By making use of an existing facility, we will assume that fixed costs are covered for already and equal to $0.

Total Cost (Production, packing, shipping) = $25 % Markup = 140% $ Markup = $35

Retail Price = $60

Through current market assessments, we have concluded that customers would be willing to pay around $60 for wEYEpers. As stated before, in the survey we conducted, 15% of respondents spend $20 - $75 annually on accessories for glasses, and the remaining 40% spend $75 or more. Other similar luxury technology and accessory products such as the Fitbit sell from approximately $90-$150 and are in high demand. However, technology such as the Fitbit offers much more features, while wEYEpers will only focus on clearing vision during inclement weather. As a result, we found that a midway price of $60 would highlight our luxury brand while still being affordable to our targeted customers. However, since we are using the skimming price method, we are always open to lowering our price over time to reach more people. Distribution

Advantages of retail exclusivity include our partner retailer devoting all of their in-store marketing to our one product. We also minimize competitor influence and distribution options (competitors being other retailers wanting to sell our product). There's also a psychological

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impact where people have a natural attraction to scarcity. Thus, gaining an appreciative audience for repeat business and word-of-mouth marketing.

We would like to sell our product through an exclusive partnership with optical retail

chain, Luxottica. Their yearly profit earnings, number of store locations, multi-brand positioning, and selection of brand-name glasses attract us to pursue an exclusive distribution deal for wEYEpers. Luxottica has over 4,800 stores all over North America as of 2012, and owns Lens Crafters and Sunglass Hut, providing us with a great opportunity to make our product easily accessible. Marketing Plan

We will create a presence for wEYEpers on social media to not only engage with our consumers, but to promote the brand, and provide any support related to orders. 62% of millennials are more likely to become a loyal customer if a brand engages with them frequently on social media. We hope to provide complete transparency on social media by addressing any issues. - Twitter - Instagram - Facebook - YouTube - Snapchat

We will also have a demo stand available in Luxottica, LensCrafters, and Sunglass Hut retail stores, which consists of a small, reusable water fountain in the middle of the store, with glasses displayed underneath the fountain to demonstrate our wEYEpers in action. Every pair of wEYEpers will have a one-year limited warranty, as well as an offer for a 30-day money back guarantee to encourage people to try our product risk-free.

We anticipate the majority of our market will consist of millennials and gen Yers. 43% of

millennials do not consider TV advertisements to be authentic. TV ads cost millions of dollars to produce, and we’d rather redirect our efforts. We plan to release monthly infotainment videos through YouTube, where we combine comedy, entertainment, and information.

We will release the “You CAN See Me” commercial featuring John Cena, our official brand ambassador! The introduction features a narrative about how people have been trying to find John Cena for years, since we “can’t see [him].” However, with wEYEpers to combat the burden of walking in the rain, you can finally see John Cena. We chose John Cena as our brand ambassador because he’s a very popular meme and a high-profile celebrity who always gives

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back. He has granted the most wishes as part of the Make-a-Wish Foundation, and is the most requested wish.

In May, to prepare for the rainiest time of the year for most Southern states, we will launch a weather app, similar to the one on the iPhone. This app will include forecasts for the week, hourly conditions, and the chance that you’ll need to equip wEYEpers to combat rain or snow throughout the day and week.

Throughout the month of June, we will launch the I Can See Clearly Now user-generated

content campaign. We want our audience to engage with our brand, so we want our consumers to cover the song, I Can See Clearly Now by Johnny Nash while using their wEYEpers. They can submit entries on Instagram using the hashtag #ICanSeeClearlyNowWithwEYEpers. We will produce a YouTube compilation, that will be released at the end of July, with the most creative 15-second renditions submitted via Instagram.

33% of millennials also rely on blogs for information before purchasing a product, so we

will take advantage of word-of-mouth sites, such as BzzAgent, to offer our wEYEpers at a discount in exchange for honest reviews on their personal blogs or YouTube channel. This campaign will begin in July and end in September, during the rainy season.

75% of millennials believe it is critical for companies to give back in some way.

Millennials are frustrated with corporate greed and are more likely to be loyal to brands that participate in sincere charity support. Starting during the second week of November, in preparation for Thanksgiving and the holiday season in December, we will launch our 20+20 Vision campaign. For every pair of wEYEpers sold, we will donate 40% of the retail price of wEYEpers to the Eyes of Hope charity organization. They provide free eye exams and glasses to families of need.

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Start social media campaigns

Introduce John Cena as official brand ambassador

Launch weather app ahead of rain season.

Launch I Can See Clearly Now UGC campaign

In-store event with John Cena

20+20 Vision campaign

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Brand launch in retail stores

In-store event with John Cena

Launch word-of- mouth ad campaign

In-store event with John Cena

20+20 Vision campaign

Introduce demo stands in-store

Demo stands in-store

Release new YouTube video

New YT video

Begin 6-week long charity campaign

20+20 Vision campaign

Launch John Cena YouTube video

Release new YouTube video

Release new YouTube video

Release new YouTube video

Release I Can See Clearly Now UCG YouTube video

Release new YouTube video

End word-of-mouth ad campaign

20+20 Vision campaign

20+20 Vision campaign ends

Goals Set Marketing objectives: 1. Achieve market share as a brand new product line in the market and enter the eyewear industry 2. Create brand recognition and convey a sense of luxury for wEYEpers to target audience 3. Making wEYEpers easily accessible to potential customers via brand website and in-store selling Financial objectives: 1. Maintaining a gross profit margin of 58.3% each month 2. Generating an average of 8000 pairs of wEYEper glasses each month 3. Retaining an annual growth rate of approximately 25% in the following year 4. Improve distribution channels to reduce logistic costs by 20%

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Sales Forecast: In 2012, 69.1 million pairs of prescription glasses were sold in the US. 95.9 million pairs

of plano sunglasses were also sold the same year. We are planning to manufacture 100,000 pairs of wEYEpers in the first 12 months of our operation cycle. For every pair of wEYEpers we sell, we will generate $60 revenue. Hence, our gross profit margin will be = (60-25)/60 = 58.33.

It costs approximately $25 to develop one pair of wEYEpers. Manufacturing 100,000 pairs of wEYEpers would cost us $2.5 million. However, if we sold 100,000 pairs of wEYEpers, we would make $6 million, giving us a net profit of $3.5 million. By the end of the year, we hope to have gained experience to learn how we can reduce costs to manufacture and ship a single pair of wEYEpers.

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