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SAMPLE MARKETING PLAN:

SONIC PERSONAL DIGITAL ASSISTANT

Sonic, a hypothetical start-up company, is about to introduce a new multifunction personal digital assistant (PDA), also known as a handheld computer Sonic’s product is entering a marketplace crowded with offerings from Palm, Handspring, and other rivals The following sample marketing plan shows how Sonic is preparing to market its first PDA

Executive Summary

Sonic is preparing to launch a new PDA product in a very competitive but fast-growing

market Despite intense competition from Palm, which leads the market, and from

Handspring, which holds the second largest share of this market, we can compete effec- tively because our offering combines innovative features at a value-added price We are targeting specific segments in the consumer and business markets, taking advantage of opportunities indicated by forecasts of significant growth in demand for wireless-enabled PDAs during the next 4 years

Given Sonic’s highly efficient product development and assembly procedures, we have minimized variable costs to establish a reasonable wholesale price, achieve market- share objectives, and reach break-even volume early in the product’s second year Competitively, we will create differentiation by emphasizing our product’s unique voice recognition system and communicating the value of our total product offering

Situation Analysis

Sonic, founded 18 months ago by two entrepreneurs with extensive experience in the

PC market, is about to enter the highly competitive $3.7 billion PDA market This market is currently dominated by Palm, which pioneered the PDA product by selling 13 million units in its first 5 years Industry-wide sales are expected to accelerate for at least the next 5 years, with multi-function devices attracting an ever-increasing share of the overall market Analysts predict 4 million in total PDA sales for next year and 5 million for the following year

Sonic’s personal digital assistant is designed to meet the communication and information needs of consumers and business users Our PDA meets these needs by delivering the following benefits: the ability to stay in touch while away from the home or

office; the ability to record information while away from the home or office; and the

ability to perform multiple communication functions without carrying multiple devices The product meets an additional personal need, that of being able to commu-

135

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136 APPENDIX2 Sample Marketing Plan: Sonic Personal Digital Assistant

nicate while expressing the user’s individuality, by providing a case wardrobe of different colors and patterns

Despite intense competition from Palm and other rivals, Sonic can rely on numerous strengths First, our PDA includes a voice recognition system licensed from Cellport Systems, a unique feature that simplifies usage and allows hands-free operation Second, we bundle valuable features found only on higher priced rival products Third, our PDA can accept any Palm-compatible peripheral, which adds to its versatil- ity And fourth, ours comes standard with many features found only as options on other models, yet it is priced lower than competing models However, our weaknesses include lack of brand awareness and image; lack of color display screen; and slightly heavier weight than most competing models (see SWOT analysis section for further details) The following sections provide further detail about the market, market demographics, market needs, market trends, target market growth, SWOT analysis, competitive analysis, product offering, keys to success, critical issues, and the macroenvironment and microenvironment

Market Summary

Sonic’s market consists of consumers and business users who need to communicate and exchange information when they’re away from the home or office Particular segments being targeted include professionals, college and graduate students, corporations, and entrepreneurs An additional segment being considered for late-year entry is medical users, including doctors and nurses who want to reduce paperwork and quickly update or access patients’ medical records

MARKET DEMOGRAPHICS Sonic is focusing on both the consumer and business markets

Consumer Market

Within the consumer market, the primary target is middle- to upper-income professionals who need one portable device to coordinate their busy schedules and communicate with family and colleagues These consumers prefer lower priced PDAs with expandable memory and functionality Demographically, this segment is defined according to professional occupation and annual income above $75,000 A secondary target is college and graduate students who need a multifunction device to organize

their school, work, and personal schedules, to store needed documents and information

for access anywhere, and to communicate with family and friends This segment can be described demographically by age (18-30) and education status (entering or in college

or graduate school)

Business Market

Within the business market, the primary target is mid- to large-sized corporations that want to help their managers and employees stay in touch and input or access critical data on the go These buyers want durable, powerful, easy-to-use PDAs that can operate customized business applications Demographically, this segment consists of companies with more than $25 million in annual sales and more than 100 employees A

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APPENDIX 2 Sample Marketing Plan: Sonic Personal Digital Assistant 137

secondary target is entrepreneurs and small business owners who need to stay in touch

and organize their busy schedules at all times

Toward the end of the year, we may enter a specialized segment of the business

market This segment consists of medical users, doctors and nurses who want to reduce

paperwork and quickly update or access patients’ medical records Research shows

that this segment’s usage of PDAs nearly doubled in the past year, with similar

increases expected in the future

According to market forecasts, the U.S PDA market will continue to grow for the

next 5 years, with 4 million units forecast to be sold next year and 5 million forecast for

the year after As multifunction and wireless PDAs become more popular, market vol-

ume is expected to increase to 10 million units or more sold annually within 4 years,

when roughly one-third of the units will allow wireless communication

MARKET NEEDS

Communication and information are the two general needs of consumers and business

users of PDAs Exhibit A2.1 shows how the Sonic PDA addresses the specific needs of

targeted segments within the consumer and business markets

Our licensing arrangement with Cellport Systems allows us to provide the unique

feature of voice recognition for hands-off operation This adds to the convenience and

ease of use that customers enjoy with Sonic PDAs and gives us a strong point of differ-

IEXHIBIT A2.1 Needs, Features) Gnd Beneliis for Sonie POA™ sy) như

Targeted Segment Need Feature Benefit

Business travelers Stay in touch while Wireless e-mail Conveniently send

(professionals in away from the and receive

Business travelers Record information _-Voice recognition _ Simple, no-hands

(professionals in while away from operation to record

the consumer the office information

market)

College and Communicate using Case wardrobe of Change the case to

graduate students a device that different colors make a fashion

(consumer market) expresses their and patterns statement

individuality

College and Perform multiple Works with Palm- Convenient, cost-

graduate students functions without compatible effective way to

(consumer market) carrying multiple cameras, software, do more

gadgets and other

peripherals Corporate users Communicate by Works with Palm- Convenience of using

(business market) inputting and compatible custom a portable device

accessing critical applications with readily- data on the go available programs Entrepreneurs Organize and access Hands-off access to Quickly check

(business market) contacts and calendar and appointments and

schedule address book locate contacts information features

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138 APPENDIX2 Sample Marketing Plan: Sonic'Personal Digital Assistant

entiation for competitive advantage in satisfying market needs Ongoing research will help us identify additional benefits and associated features that we can offer to maintain our differentiation

MARKET TRENDS

PDA purchasers have to decide between models based on two different operating systems Sonic uses the market-dominant Palm system, developed by Palm and also licensed by Handspring and Sony, among others Thousands of software applications and hardware peripherals are currently available for devices that use Palm’s operating system, including the Sonic PDA As_a result, customers have numerous choices for selecting add-ons that will provide the functionality and features they require The Pocket PC system, a variation of Microsoft’s Windows software, has been gaining in popularity due to its use in more powerful PDAs made by Hewlett-Packard, Casio, NEC, and others Models that run on the Pocket PC system also offer higher standard memory than Palm-compatible models and can more easily handle multimedia appli-

cations

Product proliferation and increased competition have resulted in lower prices and lower profit margins Lower prices are helping to expand sales of PDAs, especially in the lower end of the consumer market, but gross margins continue to be under pressure Formerly, Handspring enjoyed gross margins in the 30 percent range; such margins are rare today and may be unattainable for the foreseeable future as pricing continues to be a key competitive strategy At the same time, customers with first- generation PDAs are starting to reenter the market by buying newer, high-end multi-

function units with desirable features such as wireless access Given this trend, cus-

tomers who are already familiar with the Palm operating system are a good target for trading up to Sonic PDAs

Other market trends relate to demand for technological advances such as the inte- gration of cell phone functionality and other capabilities; sharper and larger screen displays; speedier processing of information; memory expansion; applications for specific consumer and business purposes; and more fashion-oriented accessories for PDAs

TARGET MARKET GROWIH 2 ae agg PES VE Overall growth continues strong in the consumer and business markets for PDAs However, wireless functionality is driving sales of higher-end and replacement models

As shown in Exhibit A2.2, estimated growth in wireless PDA sales is projected to out- pace growth in nonwireless PDA sales for the next 4 years

As more applications become available for voice-activated PDAs, our product will

be able to address additional market needs for current and future segments Although some competitors will likely be able.to develop or license similar voice recognition systems within 6 to 12 months, our head start should enable us to create strong brand recognition and build sales and brand loyalty among targeted market segments

Nonwireless _ 3,500,000 - 4,200,000 5,800,000 6,900,000

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SWOT Analysis

In taking advantage of growth opportunities in the wireless segment of the U.S PDA market, Sonic has several powerful strengths on which to build The most important is voice recognition capability, a feature unmatched by competitors at this time We also see the product’s value-added features offered at a low price as a second major strength

However, we face the threat of ever-higher competition and downward pressure

on pricing In addition, our major weakness is the lack of brand awareness and image

Exhibit A2.3 summarizes the strengths, weaknesses, opportunities, and threats facing

the Sonic PDA

STRENGTHS Sonic can build on three important strengths:

e Unique product offering We offer the unmatched feature of voice recognition capability plus features such as built-in wireless Web access and built-in MP3 capabilities Research shows that these three aspects of our offering are in demand by our targeted market segments

¢ Compatibility Our PDA also can work with the hundreds of Palm-compatible peripherals and applications currently available, making it more versatile and easily customized to each user’s needs and circumstances

e Pricing Our product is priced lower than competing models—all of which lack voice recognition Thus, our PDA is perceived as delivering more value, which is especially important in our increasingly price-sensitive market segments

WEAKNESSES Among Sonic’s weaknesses are:

¢ Lack of brand awareness As a start-up, Sonic has not yet established our brand and image in the target market Because Palm and Handspring both have strong

[EXHIBIT-AZI31” SWOT Anslyas for Sonte BDA’) es aaa Strengths (internal capabilities that can Weaknesses (internal factors that can

support the firm in achieving its goals) prevent the firm from achieving its goals) Voice recognition capabilities Lack of brand awareness and image Built-in wireless Web access Monochrome display

Built-in MP3 capabilities Heavier than most competing models Can use Palm-compatible peripherals

Priced lower than competing models

Opportunities (external circumstances that Threats (external circumstances that may may be exploited for higher performance) potentially hurt performance)

Increasing demand Increasing competition Availability of diverse add-on peripherals Downward pressure on pricing Availability of diverse applications for home Growing popularity of multifunction cell and business use phones

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brand recognition, we need to call attention to our brand and our product’s strengths

¢ Monochrome display Many competitors are offering color displays; Sonic’s PDA has a monochrome display geared for easy text reading, which allows us to price this model relatively low

¢ Heavier weight To accommodate the multifunction features, Sonic’s PDA is slightly heavier than most competing models —a disadvantage for a product being marketed on the basis of convenient portability As a result, we will put more emphasis on our model’s unmatched set of multifunction features and its value- added pricing, two important competitive strengths

OPPORTUNITIES Sonic can take advantage of three major market opportunities:

© Increasing demand The market for wireless Web-enabled PDAs is projected to grow much faster than the market for nonwireless models As market penetration increases, more prospects are seeing PDAs in use in work and education settings,

which in turn is boosting demand for entry-level models Also, demand for more

sophisticated, higher-end replacement models is expanding as customers who bought entry-level models are trading up to gain new features and functionality

e Add-on peripherals More peripherals such as cameras, global positioning systems, and cell telephones are available for PDAs that use the Palm operating system Consumers and business users who are interested in any of these peripherals will see the Sonic PDA as a value-priced device able to be conveniently and quickly expanded for multiple functions

¢ Diverse applications The wide range of Palm-compatible software applications available for home and business use makes the Sonic PDA a convenient multifunction device for satisfying communication and information needs

THREATS Three main threats face Sonic at the introduction of the first PDA model:

e Increased competition More companies are entering the U.S PDA market with models that offer some but not all of the features and benefits provided by Sonic’s PDA Competing Pocket PC models are becoming more popular as well This increased competition adds to the noise and confusion in the marketplace, making it more important that the Sonic marketing communication strategy stress our clear differentiation and value-added pricing

¢ Downward pressure on pricing Increased competition and market-share strate- gies are pushing PDA prices down This can be a significant threat to Sonic’s long- term financial stability if we don’t maintain tight cost controls and take advantage

of economies of scale as volumes increase Our objective of seeking a 10% profit

on second-year sales of the original model is realistic, given the lower margins in the PDA market

e Multifunction cell phones Kyocera and other manufacturers are introducing multifunction cell phones with some PDA features, such as organizers and wireless Web access Because cell phones have much higher market penetration, this trend can potentially slow growth in the PDA market To guard against this threat, we

will emphasize the size, convenience, and multifunction features of our PDA

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Competition

In the short term, Sonic is facing two main competitors in the PDA market Palm dom- inates the market with PDAs for consumers and businesses; its growing product line ranges from a low-end, non—Web-enabled, monochrome model to a slimmer, high-end model with color display that is equipped for Web access and e-mail notification Handspring, the aggressive number 2 company in the market, attracted an estimated 21 percent share in its first year and helped drive Palm’s dominance to below a 70 percent market share Handspring also licenses the Palm operating system for its PDAs, which are lower-priced and generally more versatile than Palm’s PDAs Handspring’s most recent models are slimmer and lighter than previous models despite the added func-

tionality of use as a cell phone, as a Web access device, and for e-mail communication

Most other competing PDA models are based on the Pocket PC operating system,

a variation of Microsoft’s Windows system Compaq, Hewlett-Packard, and Casio all produce PDAs that use the Pocket PC system Combined, these PDA models account for about 10 percent of the market, but analysts expect their share to continue growing The Pocket PC PDAs generally use more powerful processors and come with more standard memory than Palm-compatible PDAs

Sonic will have to take share away from Palm and Handspring—the two market leaders—to achieve our aggressive first-year objective of attaining 6 percent share of the U.S PDA market This objective is achievable because of Sonic’s superior features and value-added retail pricing of about $350 Our model is therefore highly attractive

to first-time PDA buyers in our targeted segments as well as to PDA owners in those segments who want the convenience of voice recognition commands The following table shows the current estimated market share of major competitors in the PDA mar-

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Compctitor Current Share (Estimated By Revenue)

Handspring 21%

All others 10%

Product Offering

Our first product is the Sonic PDA, with the following standard features:

Voice recognition for hands-free commands and communication Built-in wireless Web access and e-mail capabilities

Built-in MP3 music downloading and play capabilities Full range of organization and communication functions, including calendar, address book, memo pad, world clock, Web browser, e-mail program, and expense organizer

Connectors to accommodate all Palm-compatible peripherals Functionality to run any Palm-compatible application Monochrome sharp-text display

Cradle for synchronizing data with PC Interchangeable case wardrobe of different colors and patterns

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142 APPENDIX 2 Sample Marketing Plan: Sonic Personal Digital Assistant

First-year sales revenues are projected to be $60 million, based on sales of 240,000

units at a wholesale price of $250 each Our financial target is to hold first-year losses

at $10 million or less, including product development and production expenses as well

as communication and channel costs to support the initial product introduction Sonic plans a second product for introduction during the following year This second model will be a higher-end product, wholesale priced at $350 per unit, with these additional standard features:

¢ Color display

* Cell phone functionality (requires subscription to service provider partner)

*® Global positioning system locator function Our second-year objective is to achieve a 10 percent share based on sales of two models in the product This second model will help expand our reach in the business market and attract a larger share of PDA users who want to trade up to a more sophisticated multifunction model

Keys to Success

Critical Issues

A major key to success in the U.S PDA market is the establishment of a well-regarded brand name linked to a meaningful positioning Palm is the best-known brand in the PDA market at this time, and although Handspring is younger, it has quickly achieved widespread brand recognition as well Compaq and Casio, among other competitors, can leverage their existing brands and images built during decades of experience in marketing other electronic products Therefore, to be competitive in this market, Sonic will have to create a memorable and distinctive brand image projecting innovation, quality, and value

A second key to success is the proper promotion of the voice-recognition system that Sonic has licensed from Cellport Systems Users may be skeptical that a PDA can accurately recognize and act on their verbal commands For its part, Cellport is already implementing a marketing campaign in support of a separate contract it has negotiated with Ford to supply voice-activated cell phone systems as an option for installation in Ford Taurus, Mercury Sable, Ford Windstar, and Lincoln Town Car vehicles Building

on this existing publicity and awareness of the value of voice activation, we will launch

a campaign featuring celebrities voicing a variety of commands as the Sonic PDA responds We will also develop a competitive comparison ad showing how much faster Sonic PDA users can accomplish tasks using voice recognition, compared with tradi- tional PDA models Finally, we will provide Sonic PDAs to selected opinion leaders as

a way of stimulating positive word-of-mouth communication in the targeted consumer and business market segments

Sonic faces several critical issues:

e Increased competition from multifunction cell phone combinations offered by Kyocera and others could slow acceptance of our model, even though the Sonic PDA can use the Palm-compatible cell-phone attachment We plan to conduct in- depth marketing research to determine which segments are especially open to this type of competition

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¢ Competitive advances in new product innovation will challenge our ability to differentiate the Sonic PDA in a way that is meaningful to the marketplace Currently, no other model operates on a voice recognition system; within a year,

however, competitors will be able to match this valuable feature Sonic must con-

tinue to identify points of differentiation that are valued by the targeted segments and incorporate them into new models at attractive yet profitable price points

¢ The downward pricing pressure caused by the proliferation of PDA and hybrid products requires us to tightly control product and marketing costs to avoid unacceptable loss levels However, as a start-up, we must invest heavily in a marketing activities to establish our brand and positioning Therefore, we need

to carefully measure awareness and response to our marketing activities so we can make any needed adjustments in a timely and cost-effective manner

e Other issues that Sonic will need to resolve in the coming months include:

(1) Should Sonic develop a proprietary operating system, switch to the competing Pocket PC system, or continue to pay licensing fees for the Palm system?

(2) Should Sonic offer to develop customized applications for business users? (3) Should we expand our consumer market by creating a game-playing peripheral to make our PDA compatible with Sony’s PlayStation 2? (4) Should we use mass media or concentrate on creating buzz from favorable expert reviews?

Macroenvironment and Microenvironment

Sonic is influenced by factors in both the macroenvironment and the microenvironment:

¢ Macroenvironmental factors that are likely to affect Sonic’s performance include demographics (especially the huge echo boomer segment of 72 million U.S consumers); economic issues (particularly the purchasing power of echo boomers and business buyers); technology (mainly investment in and faster development of new advances for voice recognition and other PDA-related technologies); laws and regulations governing wireless communications; and social issues (including the perceived social status of PDA users)

© Microenvironmental factors that are likely to affect Sonic include suppliers (especially the continued willingness of Palm and Cellport to license their systems at reasonable fees); marketing intermediaries (particularly our ability to distribute PDAs through key channels such as computer retail chains and office supply superstores); competitors (especially new product innovations introduced by Palm and Handspring); and customers (particularly, the operating system prefer- ences of PDA users)

*® Competitive strategy Sonic plans to compete with Palm and Handspring through

a product feature strategy of specializing in voice recognition technology No other PDA currently offers this technology, which gives us an opportunity to establish the Sonic brand and image in the targeted customer segments However,

we anticipate that competitors will quickly follow suit with proprietary versions

of voice recognition systems within 6 months of our first model’s introduction To counter such competitive moves, we must maintain our planned schedule of introducing a second higher-end model with additional features within 1 year This will allow us to maintain our innovative image, improve profit margins, and focus on additional segments within the consumer and business markets We also can attract current PDA owners who are familiar with the Palm operating system, because there are fewer switching costs and less inconvenience in trading up to Sonic’s PDA, which uses the same operating system

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Marketing Strategy

Our marketing strategy is designed to support our successful entrance into the competitive PDA market We plan to build brand awareness and image while emphasizing our competitive superiority based on innovation quality, and value Using all elements

of the marketing mix, as well as service and internal marketing, we will educate our tar-

geted segments about the features and benefits of our new PDA and motivate pur- chases by first-time users as well as PDA owners seeking to trade up Although televi- sion advertising is not affordable under start-up budget constraints, we will use radio,

online, and other media to reach our targeted segments in creative and effective ways

The following sections examine our mission, marketing and financial objectives, target markets, positioning, strategy, marketing-mix elements, service and internal marketing, and marketing research plans

MISSION Sonic’s mission is to produce and market high-quality, value-priced PDA products that enable U.S consumers and business users to use voice recognition to organize data and stay in touch whenever and wherever they choose As this mission indicates, we have chosen to operate in the U.S market for handheld computing devices Our core com- petence is producing quality electronics with innovative features, notably the incorpo- ration of unique voice recognition technology for hands-free operation

We define our vertical scope as manufacturing Sonic-branded products for distribution through a network of select online and computer retailers and office supply superstores in the top 50 U.S markets Geographically, our scope initially covers the 50

states; in later years, we will consider expanding to the Canadian market and, if

demand is strong, beyond

MARKETING OBJECTIVES Our primary marketing objectives are to:

e Achieve first-year unit sales volume of 240,000, which represents a projected market share of 6 percent with one model in product line

® Increase second-year share to 10 percent, based on sales of two models in product line

¢ Generate 40 percent brand awareness within the consumer target market and 50 percent brand awareness within the business target market by the end of next year

e Arrange for distribution through Amazon.com and through the leading computer and office-supply retailers in the top 50 U.S markets within 3 months, followed by distribution coverage in the remaining major metropolitan areas within 6 months

FINANCIAL OBJECTIVES Sonic’s primary financial objectives are to:

e Restrict first-year losses to less than $10 million and seek a 10 percent profit on second-year sales of the original product

¢ Achieve first-year total sales revenue of $60 million, based on an average whole-

sale price of $250 per unit

® Earn an annual rate of return on investment of 15 percent after taxes within the first 4 years

Tiêu đề	Sample marketing plan: Sonic personal digital assistant
Trường học	Standard University
Chuyên ngành	Marketing
Thể loại	Bản kế hoạch
Năm xuất bản	2023
Thành phố	New York

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Số trang	17
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