8. 8 TurboTech Marketing: Modify Brand: In Quarter 2,
introduced Launch Pad and Launch Pad +. These introductory
TurboTech computers are based on the needs and use patterns of
innovators and travelers. Provided below are the specs for Launch
Pad and Launch Pad +: LaunchPad (Traveler) LaunchPad+ (Innovator)
Essentials BaseComponents x x Case Standard(Desktop) x x
RewritableOpticalDrive Standard x x Harddrive UltraCapacity x x
OfficeSoftware Professional x x OtherSoftware Bus.Graphics x x
Presentation x x Database x x Bookkeeping x WebDesign x x
Statistical x x Engineering x Manufacturing x Games x SecuritySuite
x x Monitor 19"standard(Desktop) x 21"highres.(Desktop) x
9. 9 TurboTech ComputingPower HighSpeed x x Keyboard&Mouse
Standard x Expanded x SpecialFeatures ExpansionSlots x x AutoBackup
x x Networking Standard x OperatingSystem ForProfessionals x x
SalesChannel:
Becauseprimarydemandislesscostlyandmoreprofitablethansecondarydemand,theexecutive
teamsoughtouttoopenasalesofficeinatopperformingmarketfortheinnovatorandtraveler
segments.Whilethesetupandquarterlyleasecostsarehigherthananyothercity,theexecutive
teamdecidedthatthe12monthpotentialdemandandpricewillingtopayjustifiedopeningthe
initialsalesofficeinLosAngeles. Manufacturing:
InordertokeepthemanufacturingcostsforTurboTechcomputerslow,theexecutiveteamchose
toopenamanufacturingfacilityinShanghai.Additionally,theexecutiveteamplannedtoexpand
intoAsia-Pacific,andamanufacturingfacilityinShanghaiwouldallowTurboTechtomaximize
profitswithinthatmarket.Providedbelowisadetailedlistingofthemanufacturingfacility,aswell
asthecurrentandplannedfixedcapacityofthefacility:
10. 10 TurboTech Finance:
Inordertofundcurrentoperations,eachmemberoftheexecutiveteampurchasedanadditional
10,000sharesofcommonstockat$100pershare.AttheendofQuarter2,theexecutiveteamchose
toleavethe$912,000ina3-monthCertificateofDepositataquarterlyinterestrateof1.5%.
ProvidedbelowisadetailedlistingofthefinancialdecisionsfromQuarter2:
Quarter3Decisions: Marketing: ModifyBrand:
InQuarter3,TurboTechstoppedtheproductionofLaunchPadandLaunchPad+,andintroduced
AxiomPadandFusionPad.AlthoughtheintroductoryTurboTechcomputershaveadifferentname
anddesign,AxiomPadandFusionPadarestillbasedontheneedsandusepatternsofinnovators
andtravelers.ProvidedbelowarethespecsforAxiomPadandFusionPad:
FusionPad (Traveler) AxiomPad (Innovator) Essentials BaseComponents
x x Case Standard(Laptop) x x RewritableOpticalDrive Standard x x
HardDrive
11. 11 TurboTech UltraCapacity x x OfficeSoftware Professional
x x OtherSoftware Bus.Graphics x x Presentation x x Database x x
Bookkeeping x WebDesign x x Statistical x x Engineering x
Manufacturing x Games x SecuritySuite x x Monitor
14"Standard(Laptop) x x ComputingPower HighSpeed x x
Keyboard&Mouse Standard x Expanded x SpecialFeatures
ExpansionSlots x x AutoBackup x x Networking Standard x
OperatingSystem ForProfessionals x x
12. 12 TurboTech Price&Priority:
BasedonthepricewillingtopayinLosAngelesandtheaveragecostofproduction,theexecutive
teamdeterminedtheretailpriceforAxiomPadandFusionPad.Attheretailpriceof$2,300.00,
FusionPadwasgivensalesprioritynumber1,nopricerebatewasoffered,andapointofpurchase
displaywaspurchased.Attheretailpriceof$3,000.00,AxiomPadwasgivensalesprioritynumber
2,apricerebateof$300wasoffered,andapointofpurchasedisplaywasoffered.Providedbelowis
adetailedlistingofthepriceandpriority,aswellastheupdatedspecsforAxiomPadandFusion
Pad: ModifyAdvertisements:
ToboosttheexposureofAxiomPadandFusionPad,theexecutiveteampurchasedlocalmediain
LosAngeles,andregionalmediaacrossNorthAmerica.AlthoughtheonlyTurboTechsalesoffice
wasinLosAngeles,theexecutiveteamdecideditwouldbebeneficialtoseedtheregionalmarket
beforeexpandingintoChicagoandToronto.
Whendecidingonthestructureoftheadvertisements,theexecutiveteamreferencedthemarketing
researchonusepatternandmediapreferences.Basedoninsightsobtainedfromtheresearch,the
executiveteampurchased4localand4regionalmediaplacements,totalingto$86,506.Provided
belowishierarchicallistingoftheadvertisementsforAxiomPadandFusionPad,aswellasthe
localandregionalmediaplacements: Axiom Pad Fusion Pad Most Powerful
PC On Market 1 2 Largest Data Storage On Market 5 Feature Office
Applications 5 Business Graphics Applications 9 8 Data management
applications 6 Presentation Applications 4 7
13. 13 TurboTech Statistical Applications 2 Web Design
Applications 3 Easy To Use, Simple Design 1 Smart Backup System 7
Portable Design 4 Link PCs With Network/Internet 8 9 Picture
Business Professionals 6 Picture People In Travel Setting 3
MarketingResearch:
Tobetterunderstandcustomerneedsandusepatterns,theexecutiveteamspent$20,000.00on
marketingresearchforNorthAmerica. SalesChannel: HireSalesPeople:
Tomeettheforecasteddemandof300computers,theexecutiveteamhired5salespeopleforthe
officeinLosAngeles.Becausetheexecutiveteamwasunsureofthedemandeachsegmentwould
generate,2salespeoplewerehiredfortheinnovators,2salespeoplewerehiredforthetravelers,
and1salespersonwashiredforsupport.Providedbelowisadetailedlistingwhichoutlinesthe
16. 16 TurboTech Fusion2.0 (Traveler) Axiom2.0 (Innovator)
Essentials BaseComponents x x Case Standard(Desktop) x
Standard(Laptop) x RewritableOpticalDrive Standard x x HardDrive
UltraCapacity x x OfficeSoftware Professional x x OtherSoftware
Bus.Graphics x x Presentation x x Database x x Bookkeeping x x
WebDesign x x Statistical x Engineering x Manufacturing x
SecuritySuite x x Monitor 21"HighRes.(Desktop) x
14"Standard(Laptop) x ComputingPower HighSpeed x x
Keyboard&Mouse Standard x Expanded x SpecialFeatures
17. 17 TurboTech ModifyAdvertisements:
ToboosttheexposureofAxiom2.0andFusion2.0,theexecutiveteampurchasedlocalmediainLos
Angeles,andregionalmediaacrossNorthAmerica.AlthoughtheonlyTurboTechsalesofficewasin
LosAngeles,theexecutiveteamdecideditwouldbebeneficialtoseedtheregionalmarketbefore
expandingintoChicagoandToronto.
Whendecidingonthestructureoftheadvertisements,theexecutiveteamreferencedthemarketing
researchonusepatternandmediapreferences.Basedoninsightsobtainedfromtheresearch,the
executiveteampurchased4localand4regionalmediaplacements,totalingto$86,506.Provided
belowishierarchicallistingoftheadvertisementsforAxiom2.0andFusion2.0,aswellasthelocal
andregionalmediaplacements: Axiom2.0 (Innovator) Fusion2.0
(Traveler) MentionBrandName 1 2 DoesAWideVarietyOfTasks 7
MostPowerfulPCOnMarket 5 NewAndImprovedBrand 2 1
LocalSalesandSupport 8 FeatureOfficeApplications 3 BusinessGraphics
Applications 3 DataManagement Applications 8 ExpansionSlots x x
AutoBackup x x Networking Standard x x Battery Standard(Laptop) x
OperatingSystem ForProfessionals x x
21. 21 TurboTech SituationAnalysis ExternalAnalysis:
CustomerAnalysis: There are 5 customer segments in our market. The
first is the Costcutter segment. This customer is looking for a
no-hassle experience and desires minimum complexity for operators.
The costcutter is looking for a machine that is easy to use, easy
to set up and something that requires little to no training to use.
They are typically influenced by the recommendation of others and
prefer courteous personnel. Desired features include word
processing, bookkeeping, budgeting and data management software.
The costcutter is looking to pay the lowest price for their
product. According to our market research, Los Angeles, Mexico
City, and Sydney are the top three cities where costcutter
consumers are located. These consumers are willing to pay up to
$1,860, $1,843, or $1,822 for a computer in each city respectively.
Costcutters are interested in sports media, leading trade journals,
general business, and new venture magazines. The second market
segment is the Innovator. These consumers prefer the brand vendor
to be a technical leader and the computers to reflect the most
updated software. Innovators look for larger computer screens so
they can view multiple tabs at once and want as much storage space
as possible. They require fast access to graphical images and are
interested in high performance over price. Some of the most desired
features include technical graphics, web design and management,
statistical analysis, communication with other computers, data
management- accounts and engineering and design features. According
to our market research, Chicago, Los Angeles, and Warsaw are the
top three cities where innovator consumers are located. These
consumers are willing to pay up to $3,209, $3,126, or $3,058 for a
computer in each city respectively. Innovators have the following
media interests: new venture magazines, computer magazines,
science, and technology. The Mercedes consumer is the third segment
in our market. This customer looks for the best of the best and
demands the most features out of all of the other segments.
Mercedes consumers look for easy to use, fast working, up to date
computers with the latest software technology and access to the
most amount of applications. They demand the highest quality
product with the best service. Some of the most desired features
for the Mercedes consumers include: manufacturing
22. 22 TurboTech process control, communication with other
computers, technical graphics and computer aided design
manufacturing. The Mercedes customer is willing to pay the most for
the best product. According to our market research, Chicago,
Toronto, and Los Angeles are the top three cities where mercedes
consumers are located. These consumers are willing to pay up to
$4,164, $4,106, or $4,065 for a computer in each city respectively.
Their media preferences are general news magazines, science and
technology, business newspapers and computer magazines. Workhorse
is our fourth market segment. These consumers are looking for an
easy to use, secure, no-hassle computer with a multi-purpose work
station. Workhorses desire monitor that is easy on the eyes and
reliable but affordable and available in all local markets. Desired
features for the workhorse segment include: bookkeeping and
budgeting, word processing, communications with other computers,
data management-accounts, web design and management, business
graphics, presentations and statistical analysis. According to our
market research, Toronto, Los Angeles, and Warsaw are the top three
cities where workhorse consumers are located. These consumers are
willing to pay up to $2,707, $2,698, or $2,649 for a computer in
each city respectively. Workhorses are interested in general
business and sports magazines, leading trade journals, business
newspapers and general news magazines. Our fifth and final market
segment is the Traveler market segment. The most important feature
to this consumer is the ability to connect to the office when on
the road. In addition, travelers need reliability, ease of access
and the ability to send and receive emails. They want a small,
lightweight, easily portable machine that is secure and easy to
use. Travelers desire a fast network connection and a lot of
storage space. Desired features for the traveler segment include:
presentation capabilities, communication with other computers, word
processing, business graphics, data management-accounts and
bookkeeping/budgeting software. Travelers are willing to pay a
reasonable price for a good quality product. According to our
market research, Mexico City, Chicago, and Toronto are the top
three cities where traveler consumers are located. These consumers
are willing to pay up to $3,019, $2,977, or $2,894 for a computer
in each city respectively. Travelers are typically interested in
the following medias: new venture magazines, leading trade
journals, sports magazines, general news magazines, and business
magazines
53. 53 TurboTech Tactics: Quarter5: o Spent$3,613,211onR&D
o High-speedcomputingpower o Long-lastingbattery o
UpdatedAxiom2.0andFusion2.0 Quarter6: o
IncreasedproductiontolowertheaverageCOGS o
UpdatedAxiom3.0andFusion3.0 o AddedEliteChrome Quarter7: o
Spent$5,318,753onR&D o 32highresolutionmonitor(desktop) o
Uninterruptiblepower o AddedInova o DiscontinuedEliteChrome
Quarter8: o UpdateInovaandFusion3.0 Price: Objective:
Theobjectiveforpriceistohavenolessthanapricejudgmentof95forallbrands.TurboTechaims
toaccomplishthisbyreducingtheCOGSthroughcreatingeconomiesofscale,streamliningeach
brandtoprovidecustomerswiththefeaturestheytrulywant,andusepricingtoincreasemarket
share. Strategy:
TurboTechspricingstrategyistoslightlyraisepricesbasedoffofbrandjudgmentandprice
judgment.TurboTechcanremaincompetitivebymatchingtheretailpricewiththepricewillingto
pay,andprovidingarebatetofacilitatesalesinallmarketswithsalesoffices.
Tactics: Quarter4: o Offereda$300rebateforAxiom2.0 Quarter5: o
Offereda$100rebateforFusion2.0(NORAM) o
Offereda$200rebateforAxiom2.0(NORAM)
55. 55 TurboTech Strategy:
Openedsaleslocationswheremarketdemandishigh
Continuedtopurchasemarketresearch Goglobal Tactic: Quarter4: o
OpenedsalesofficesinChicago,Toronto,andTokyo o
Purchasedmarketingresearch Quarter5: o Purchasedmarketingresearch
Quarter6: o Hired34salespeople o Purchasedmarketingresearch
Quarter7: o OpenedsalesofficesinSydney,Shanghai,andParis
57. 57 TurboTech OtherStrategies: Production: Quarter4: o
Maintainedafixedcapacityof25units Quarter5: o
Increasedfixedcapacityfrom25to75units o
Increasedproductiontoloweroverheadcostsandaccuratelymeetdemand
Quarter6: o Maintainedafixedcapacityof75units o
Increasedproductiontoloweroverheadcostsandaccuratelymeetdemand
Quarter7: o Increasedfixedcapacityfrom75to125units Quarter8: o
Maintainedafixedcapacityof125units
TheproductionofTurboTechcomputersheavilyreliedondemandfromtheinnovatorandtraveler
segments.Throughinnovationandconsistentproductdevelopment,eachquarterTurboTech
increaseddemandandmoreaccuratelymatchedfixedcapacity.ByQuarter5,demandfor
TurboTechcomputersoutweighedmanufacturingcapacityandforcedtheexecutiveteamto
increasethelaborforce,aswellasfixedandoperatingcapacity.InQuarter6,TurboTechsatisfied
demand,butoverestimatedby1%offixedcapacity.Consequently,excessinventorycarriedoverto
Quarter7,setbacktheproductlaunchofInovo,andforcedtheexecutiveteamtosalvagethe
remaininginventoryofEliteChrome.
