Marketing Plan for New Pen Drive (Dilato) launch..

STRATEGIC MARKETING MANAGEMENT MARKETING PLAN OF DILATO PEN DRIVES

SUBMITTED TO: DR.N.MURTHY

SUBMITTED BY: GROUP NO: 4 ANOOP.S. PILLAI CHARANYA.M GOPINATH.S RAJ PRADEEP.T.N VAMSIKANTH

SUBMITTED ON: 30/11/2009

ACKNOWLEDGEMENT

These acknowledgements are not just a piece of formality but our heartful gratitude towards all those who cooperated with us and extended their support in the making of this report. First and foremost, we would like to thank to DR.MURTHY for the valuable guidance and advice. He inspired us greatly to work in this project. His willingness to motivate us contributed tremendously to our project. We also would like to thank him for showing us some example that related to the topic of our project in the classroom. Besides, we would like to thank our college for providing us with a good environment and facilities to complete this project. In addition, we would like to take this opportunity to thank the non-teaching staff, Librarian, Computer assistants for allowing us to work at late nights. It gave us an opportunity to participate and learn about the “MARKETING PLAN OF DILATO PEN DRIVES”. Finally, an honorable mention goes to our friends for their understandings and support to us in completing this project.

EXECUTIVE SUMMARY The following marketing plan forms the basis for the introduction of a range of innovative new products in the pen drive category. The analysis allows us to outline the best strategies to follow for the achievement of the company’s strategic goals. “Dilato” will be marketed as a unique functional pen drive while striving to reinforce the company’s status as the leader in innovation and successful product launches. The Indian external data storage market is estimated at roughly Rs 900 crore, growing at over 20 per cent since 2007. The mid-tier segment occupies almost onethird of the total market. Growth in internet surfing and content building has contributed to an increasing demand for high-storage external devices. External hard disks of 250 GB and 320 GB capacities capture 75 per cent of the market demand, followed by portable pen drives, MP3 players and flash drives. Storage capacity, speed of transfer, reduction in noise and portability are the main drivers for the demand for external storage devices. Success will be reflected by a sizeable capture of market shares within this market, while strategically carrying the company up to the top spot as the market leader in the FMCE sector. Our major competitors are Kingston, SanDisk, and Transcend. Our just completed pilot study reveals that Kingston, Transcend, SanDisk and iball are the major players who have occupied the Indian market with their offerings, but since we found out that Kingston and Transcend are occupying the strong positions in the market perception level about product, price and quality, and offerings, the major successful factor which driven them to this level is creation of demand for the product. Kingston and Transcend carries the advantage of product innovations in the Flash Drive market, by launching innovative and stylish product ranges, attractive channel and end user schemes, and marketing activities as well as defining new market segments, which lead them to success in the Indian competitive market. We aim to create superior quality products that fit your high - tech lifestyle, and we believe in WIN, WIN, and WIN philosophy. The main principal objective is always to be a Customer driven company, we focus our objectives on providing the superior quality products that fits high - tech lifestyle. The corporate culture that exists in the organization is professionalism and team work as well. As a declaration of our commitment to quality we would implement the Six Sigma concept throughout the company, our commitment to R & D ensures that we will continue to introduce superior quality

products to leave the competition far behind. As a company our superior quality products which brings Tomorrow's World, Today. The project is on creating a marketing plan for pen drives which involves the creation of the brand and brand elements along with the suitable integrated marketing communication for the product. It also includes various studies like the market analysis, competition analysis and competition pricing to find out the feasibility of the product in the market. Then the entire segmentation, targeting and positioning for the product is designed with the complete product mix and product variants with their respective pricing and the logic behind the pricing. Next the marketing plan talks about the entire distribution channel that will be followed for an effective reach of the products to the end users through various channel partners. We believe that good marketing objectives which help an organization for its success, and also guides us to enable a business to control a marketing plan, To help motivate individuals,To provide a common goal, To provide an agreed, consistent focus for all function of our organization. Objectives provide the starting point for marketing plans and marketing strategy. The success of the strategy should be evaluated in terms of the extent to which the objectives were achieved. Dilato’s objectives set out what we are trying to achieve, and our marketing objectives can be defined at two different levels: Corporate Level and Functional level. In corporate level objectives we would consider customer loyalty, profit, growth, Market leadership, Commitment to dealers, retailers & employees and Leadership capability. In corporate level we aim to build customer database of at least 250,000 households within the next 12 months. We also aim to achieve a market share of 10%• We aim to achieve 75% customer awareness of our brand in our target markets. We offer a wide range of pen drives such as low end, popular and the luxury which caters to different segments of the target group. In Low end segment we offer USB flash drives/pen drives that are priced below Rs 300. It will be of low price with the basic features, medium size and easy to hold. In Popular segment we offer those pen drives which have some special features like Bluetooth and Expandable memory. In luxury segment we offer those pen drives which have some special features like LCD displays, MP3 player and Camera. We develop clear – headed strategies for achieving our sales and marketing goals. At period of time we evaluate our brand challenges and deliver customized products and communications plans to our target group. Our plans integrate tactical public relations and marketing communications to drive results in current situation and competitive markets. We ensure continued product development and market visibility with measurable results that help to achieve well – defined business goals. We would target Students, Business, Working Professionals (age above 15 yrs) and Corporate Industries / Institutions comes under Luxury, Popular and Low end segment; who frequently transfers data. When compare to other storage devices pen drives are helpful for these target groups in easy way of transferring and storing data.

Moreover, the marketing team also have to implement effective control mechanism and evolution of effectiveness method in order to ascertain the launch of Dilato is successful; the marketing strategies are efficient and progress constructively according to projection especially in sales and penetrating targeted market. The suggested apparatus had been designed to aid the department to evaluate the effectiveness of Dilato marketing plan and objectives are Constant market survey and research, Quality Control mechanism, Customer Service and technical support team, implement comprehensive plan to monitor the sales of Dilato. In evaluation and control mechanism we do a Periodic Review, take care of the training Needs, Revenue Assessment and Reviewing the Supply-chain and Dealer meet.

S.NO

CONTENT

PAGE NO

1

INTRODUCTION

1

2

SITUATIONAL ANALYSIS

2

3

MARKETING OBJECTIVES

9

4

FINANCIAL OBJECTIVES

11

5

ACTION PLAN

12

6

IMPLEMENTATION,CONTROL AND EVALUATION

24

7

CONCLUSION

29

8

APPENDICES

31

9

REFERENCES

39

INTRODUCTION As pen drives come under the consumer electronics industry, which is one of the largest segments in the electronics industry in India. With a market size of $4.7 billion in 2008 catering to a population of more than one billion people and significantly a low penetration of CE products. The consumer electronics industry in India promises huge potential in the years to come. The double digit compound annual growth over the next five years will be aided by various factors such as growing household incomes, local manufacturing and expanding distribution networks. As far as the local economy is concerned there won’t be any effect on our business if any change to the local economy is made. The flash market is one of the biggest growing segments in India. However, due to its substantial dependence on parallel imports, apart from business generated through authorized distributors, it is very difficult to estimate the correct size of the market. And, surprisingly, the model is highly supported by the principals themselves. The market is primarily fed by China and Taiwan, and runs purely on cash transactions. It is a high volume business, conducted through both IT and telecom channels as well as large format retails. However, with the current duty structure in place, FY 09 witnessed a major decline in parallel imports. Competition which creates fire to success for every company, as it is FMCE (fast moving consumer electronic) product the scope for the growth rate is also good which creates to chance for international players like Smart Modular, A - Data, Ramaxel, and Apacer to enter and expand their business in this competitive market. But since we would carry the competitive advantage of the first company to introduce the expandable USB flash drive and Bluetooth USB

flash drive to the Indian market with various product mix combinations, so it is a competitive chance for the international entrant to adopt the same concept as such soon, and also to add fuel since the international players are playing in the Indian market such as Kingston Technology which has 28% of market share but still didn't introduce the concept of expandable and Bluetooth USB flash drives to the Indian market. In the current Indian scenario, the customers cannot expand their pen drives according to their requirements and hence have to go for new pen drives with higher storage capacity in order to transfer huge data’s and information. Added to this, there is no such facility that could allow multiple users to access a single pen drive at a particular location or platform inorder to share the common data’s and information. This situation is prevailing due to the lack of innovation in the pen drive industry as far as the Indian market is concerned. Our main purpose of the plan is to bring innovation into the pen drive industry as far as the Indian market is concerned. Thus we are introducing the following high end features into our Dilato pen drives at different variants catering to various segments of our target group. such as Bluetooth, LCD displays, MP3 player, Cameras and expandable memory in the pen drives.

SITUATIONAL ANALYSIS

INDUSTRY ANALYSIS: One industry that defied the slowdown and went on to grow at a pace of over 50%is the ever burgeoning market of storage peripherals. It includes devices such as flash/pen drives, flash memory cards and sticks (that are used in mobile handsets and digital cameras), external hard disks, MP3/MP4 players, and digital cameras. What further helped the market in FY 09 was reduced duty structure introduced by the Government of India, post Budget 2008. This new and flexible duty structure not only helped importers in flooding the Indian market with these fast moving products, but also stabilized the average selling price (ASP) of these devices hence, giving an additional boom to the market. Another important changeover that took place with the introduction of current duty structure is the gradual decline of gray market that until previous fiscal, formed a large chunk of the market. However, parallel imports still dominated the market and is encouraged by the principals themselves. Flash your Style

With the increase in demand for digital data storage requirements, coupled with extensive mobility associated with modern day-to-day business life demand for external and portable storage mediums have been growing heavily. Both flash drive and flash card markets have been growing phenomenally over the last two years. Although, the market was affected slightly due to the slowdown, yet business was good in both product categories. What was more visible was the rising demand for high-capacity pen drives. Today, the entry level capacity for a flash drive is 2GB/4GB which constitutes 70% of the market. The demand for 8GB flash drives followed by 16GB too has gained traction over the last year.

DQ Estimates Cyber Media Research The flash market is one of the biggest growing segments in India. However, due to its substantial dependence on parallel imports, apart from business generated through authorized distributors, it is very difficult to estimate the correct size of the market. And, surprisingly, the model is highly supported by the principals themselves. The market is primarily fed by China and Taiwan, and runs purely on cash transactions. It is a high volume business, conducted through both IT and telecom channels as well as large format retails. However, with the current duty structure in place, FY 09 witnessed a major decline in parallel imports. The end customer pull for Transcend in the flash market is very high and its popularity is fast increasing. Kingston, however, is its biggest competitor. Both the brands offer a similar product range, and have an aggressive pricing and strong channel programs. The horse race has prevented both the brands to cement the number ONE position, and the rankings alter between the two on a monthly, and sometimes even on a quarterly basis. One major issue pertaining to Transcend is its lack of any local base in India, resulting in a poor structure of distribution. The fact that it has appointed too many national, regional, and local distributors along with its

extensive parallel importers, the competition among its channel has risen ensuing price undercutting and a volatile distribution system. Kingston, on the other hand, has a more organized distribution model and a local team to drive the same. The move has helped Kingston to regularize its product distribution and availability as well as protect its partners. The third big name in this category is SanDisk. It was doing good business but it lost momentum over the last one year, thus giving away considerable market share to both Transcend and Kingston. However, SanDisk has been on the forefront in terms of setting new trends by launching innovative and stylish product ranges, attractive channel and end user schemes, and marketing activities as well as defining new market segments. The most important development in the last year was the declining share of parallel or gray market trend that remained the dominant factor in all product categories in the storage peripheral segment. With IT products becoming more like lifestyle products, the storage peripheral devices are going beyond just data storage. It is fast embracing the concept of lifestyle storage with highcapacity and high-performance being the buzzwords. MACRO ENVIRONMENT As pen drives come under the consumer electronics industry, which is one of the largest segments in the electronics industry in India. With a market size of $4.7 billion in 2008 catering to a population of more than one billion people and significantly a low penetration of CE products. The consumer electronics industry in India promises huge potential in the years to come. The double digit compound annual growth over the next five years will be aided by various factors such as growing household incomes, local manufacturing and expanding distribution networks. As far as the local economy is concerned there won’t be any effect on our business if any change to the local economy is made. The flash market is one of the biggest growing segments in India. However, due to its substantial dependence on parallel imports, apart from business generated through authorized distributors, it is very difficult to estimate the correct size of the market. And, surprisingly, the model is highly supported by the principals themselves. The market is primarily fed by China and Taiwan, and runs purely on cash transactions. It is a high volume business, conducted through both IT and telecom channels as well as large format retails. However, with the current duty structure in place, FY 09 witnessed a major decline in parallel imports. Competition which creates fire to success for every company, as it is FMCE (fast moving consumer electronic) product the scope for the growth rate is also good which creates to chance for international players like Smart Modular, A - Data, Ramaxel, and Apacer to enter and expand their business in this competitive market. But since we would carry the competitive advantage of the first company to introduce the expandable USB flash drive and Bluetooth USB flash drive to the Indian market with various product mix combinations, so it is a competitive chance for the international entrant to adopt the same concept as such soon, and also to add fuel

since the international players are playing in the Indian market such as Kingston Technology which has 28% of market share but still didn't introduce the concept of expandable and Bluetooth USB flash drives to the Indian market.

Today’s plethora of digital devices lets us create, store, play and share all kinds of digital media, including mp3s, photos, videos, documents and more. With the growing sophistication of these devices comes a need for ever greater amounts of storage, in a small physical size, using the least amount of battery power possible, giving you longer battery life when you most need it. Flash memory was invented by SanDisk and is a computer chip that retains its memory even when turned off or unplugged. This was a breakthrough, as previous types of memory chips would instantly lose any information stored on them when the power was switched off. Now that a type of solid state memory with no moving parts had been developed, a possible eventual replacement for the hard drive was born. Fast forward to the end of 2005, and flash memory has finally matured into a large capacity product that takes up little space and has much lower power requirements than a hard drive – using 30 times less power. It is lightweight, reliable, highly durable being able to withstand being dropped and other rough treatment and is getting ever cheaper, although today still very expensive for traditional hard disk sizes of 30Gb and larger. As with hard drives, flash memory is not indestructible, nor does it last forever, with 10 years being the expected data retention life span for flash and a lifespan of at least 5 years and more for hard drives, although by then you’re likely to be using much more advanced technologies (flash, hard drive based, optical or something else) with far greater capacities. Today Pen Drives have come up as the most advance and effective medium of data storage and have become a popular tool for business and professional people. USB pen drives have established themselves as the most effectual storage device, which allow users to store a vast amount of data without much effort. This is because of the increasing popularity of these useful pen drives that CDs and floppy diskettes have been replaced and have become a second option for storage. The most fascinating feature of this majestic device is that it holds memory without any power supply. Moreover, it is very easy to carry it anywhere. Pen drives are available at various sizes from 2GB to 16GB costing from 200Rs onwards.

COMPETITION: Our competitors are Transcend, SanDisk, Kingston and I Ball.

Our just completed pilot study reveals that Kingston, Transcend, SanDisk and I ball are the major players who have occupied the Indian market with their offerings, but since we found out that Kingston and Transcend are occupying the strong positions in the market perception level about product, price and quality, and offerings, the major successful factor which driven them to this level is creation of demand for the product. Kingston and Transcend carries the advantage of product innovations in the Flash Drive market, by launching innovative and stylish product ranges, attractive channel and end user schemes, and marketing activities as well as defining new market segments, which lead them to success in the Indian competitive market. The major strategies we would follow to track the competitors and stand alone in the market, we would develop the products with believing the Five Core Competence Level which will lead us to market leaders: Best Quality Control: Every product receives complete testing on quality at every stage of the product development with vast range of components and peripherals. Product Expertise: Every product will be developed in expertise way to give a new look to market, and we meet the customer's requirements by offering the product developments which brings Tomorrow's World, Today. Easy to Use: We make sure that our products are ready for easy installations and use, with clear and complete. Time for Need: We make sure that our products are available at every place with competitive offerings to the customer WIN WIN and WIN Policy: We believe in WIN, WIN and WIN policy, Our retailers should WIN their business goals with our product, Our Customers should also WIN from our benefits, together which leads us to WIN our business goals. Customer is the king for our business; Today Pen Drives have come up as the most advance and effective medium of data storage and have become a popular tool for students, business and working professional people. USB pen drives have established themselves as the most effectual

storage device, which allow users to store a vast amount of data without much effort. With well established channel network we make sure the product is available with competitive prices and sizes at every place, the customer can easily walk in to nearest store and verify all available product mix to take buying decision easily and quickly.

COMPARISON OF Transcend v/s Kingston

Transcend

Kingston

Products

1 GB – 64 GB

1 GB – 16 GB

Price

Less Expensive

Costly

Warranty

2 Years

5 Years

Mostly Preferable By

Students

Professionals

Certification To Co.

ISO 9001

ISO 9001

ISO 14001: 2004 Availability

Easily Available

DEMAND AND SUPPLY OF PEN DRIVES

In Selected Shops

SRENGHT AND WEEKNESS OF TRANSCEND PEN DRIVE STRENGTH

WEEKNESS

AWARNESS

BRAND IMAGE SIMPLICITY

LIMITED WARRANTY

LOW COST MARKET SHARE CUSTOMER SERVICE GOODWILL

SRENGHT AND WEEKNESS OF KINGSTON PEN DRIVE STRENGTH

WEEKNESS

HANDY

SLOW TRANSFER LIGHT WEIGHT

NO LOCK

GOOD BUILD QULATITY

NO PASSWORD PROTECTION

LARGE CAPACITY

DOES NOT WORK IN WINDOWS 98

FAST SPEED BRAND NAME

INTERNAL STRENGTHS AND WEAKNESS

1. Good distribution

1. Low awareness level

1. Low cost 2. Good transfer speed 3. Warranty 4. High end features

OPPORTUNITIES 1. Competitors market 2. Advancing technology 3. Market expansion

THREATS 1. Competitors 2. New players

“A good objective of leadership is to help those who are doing poorly to do well and to help those who are doing well to do even better.” MARKETING OBJECTIVES We believe that good marketing objectives which help an organization for its success, and also guides us: ➢ ➢ ➢ ➢

To enable a business to control a marketing plan To help motivate individuals To provide a common goal To provide an agreed, consistent focus for all function of our organization.

Objectives provide the starting point for marketing plans and marketing strategy. The success of the strategy should be evaluated in terms of the extent to which the objectives were achieved.

Dilato’s objectives set out what we are trying to achieve, and our marketing objectives can be defined at two different levels: ➢ Corporate Level ➢ Functional level Corporate Level Corporate level objectives than concern the business or organization as a whole which defined below: Customer Loyalty: We would like to be customer driven company, we earn customer loyalty by providing superior quality products that fit your high – tech life style, and we believe in WIN, WIN and WIN philosophy. Profit: We achieve desired profits to finance growth, and create value to our employees, retailers, our customers and our corporate objectives. Growth: We consistently find market opportunities for growth which makes us to stand alone in the competitive market. Market leadership: We lead in the competitive market by developing and delivering the superior and innovative quality products, services and clear and complete solutions. Commitment to dealers, retailers, and employees: We make sure to define that our commitment to our dealers, retailers and employees by rewarding based on their business performance, and creating a value relationship platform that reflects our values Leadership capability:

At every certain period, we find the people those achieving their business results and top performers will be indentified as Leaders to create a competitive work environment which leads us to win and grow. FUNCTIONAL LEVEL: We aim to build customer database of at least 250,000 households within the next 12 months We aim to achieve a market share of 10%• We aim to achieve 75% customer awareness of our brand in our target markets Both corporate and used SMART criteria.

functional

objectives

need

to

conform

to

the

commonly

The SMART criteria (an important concept which you should try to remember and apply in exams) are summarized below: Specific - the objective should state exactly what is to be achieved. Measurable - an objective should be capable of measurement – so that it is possible to determine whether (or how far) it has been achieved Achievable - the objective should be realistic given the circumstances in which it is set and the resources available to the business. Relevant - objectives should be relevant to the people responsible for achieving them Time Bound - objectives should be set with a time-frame in mind. These deadlines also need to be realistic.

FINANCIAL OBJECTIVES Financial Objectives that helps us to make our products set even more technological advanced at all market places, for our organization the ultimate goal of the marketing plan is the effect it will have on the bottom lin. Measures reflect income statement items and common ratios. We focus our financial objectives on Customer sales and Channel sales ➢ Achieve revenue growth of 20% per year ➢ Increase sales by 15% annually ➢ Recognition as a “Superior advanced products” company

➢ Stable earnings during recessionary periods ➢ Increase profit margins and decrease working capital life cycle ➢ Maintain strong cash flow Attractive profitability: Because of superior advanced quality products and less competition, Dilato achieves attractive profits. Stable, Growing Market: Dilato’s primary customer base – Young Students, Business, Working professionals and Corporate industries tends to be less sensitive to the economic cycles faced by many other businesses. Since Dilato products fulfill all high – tech life style needs, they are essentials for all professionals and business concerns at every period. This provides Dilato with a relatively stable market in which to do business. Overall Strategy to achieve Marketing and Financial Objectives: We develop clear – headed strategies for achieving our sales and marketing goals. At period of time we evaluate our brand challenges and deliver customized products and communications plans to our target group. Our plans integrate tactical public relations and marketing communications to drive results in current situation and competitive markets. We ensure continued product development and market visibility with measurable results that help to achieve well – defined business goals. We structure our pipeline with different methods distinctive brand positioning, credible visibility, and enchaining bottom lines. Our R&D support would make sure to develop our products at every point time to meet the market needs. We create a distinctive brand positioning in the minds of consumer through our message saying that “Our superior quality products which brings Tomorrow’s World Today.

We redefine our communication message according to the different target audience. In case of Medium and Luxury end segment pen drives we mainly focus on Business and Working professionals, and communicate through popular business magazines explaining the products features and benefits. In case of Low End segment pen drives we mainly focus on the young students and corporate industries, and communicate through weekly and daily magazines explaining the various products mix and price options. To add more fuel to create a strong brand positioning we would participate in Trade shows, sponsorships and seminars to give more identity to our brand.

We follow open doors to build strategic relationships, the sales department would make sure that to provide the complete sales support all every level, everyone has right to bring an opportunity or problem identification for the product development can bring into notice at any point time. The competitor’s product developments and promotion offerings would indentified through the sales department. And at the end what we believe as our overall important strategy is We put our customers first in everything we do. One of our key strengths is our enormous product range. We design, develop new advanced products to fit every one’s high – tech lifestyle. Tactical Action Plan When it comes to customers we keep in mind the importance of target marketing. The reason this is important is that only a proportion of the population is likely to purchase any products or service. By taking time we have to pitch our sales and marketing efforts to the correct market so that it will be more productive and not waste of efforts or time. It's important to consider the virtual segmentation by selecting particular verticals to present your offerings to. Those verticals will have the particular likelihood of purchasing your products and services. Again, this saves you from wasting valuable time and money. ➢ Target segments should be compatible with the organization’s goals and image ➢ The market opportunity represented by the segment must match the company’s

resources

➢ The segment must represent an opportunity to generate enough sales to generate a profit ➢ The company should select target segments where it can enjoy a competitive advantage Pen drive is a portable electronic data recovery device, featured with huge memory capacity enabling to store more than compact discs. While compact discs collect data and restores it in a hard drive, this same work can be done more efficiently using a pen drive, which in comparison stores much more data. Storing spreadsheets, music, films and word documents

in it is an

effortless task. Pen drive has multitudes of advantages. It is compact in size and hence is easily portable, making it convenient to be carried in one`s pocket. On the other hand, the compact discs are larger and brittle demanding cautious handling. Pen drive is also sturdy erasing the rule of breaking, unless an immense weight is exerted on it. Thus the pen drive is widely used by all the segments because of its above mentioned features.. But they are widely used by the students, business and working professionals because of their unique needs. Therefore we are targeting this particular segment of the people. There are certain specific characteristics observed in this segment: We would target Students, Business, Working Professionals (age above 15 yrs) and Corporate Industries / Institutions comes under Luxury, Popular and Low end segment; who frequently transfers data. When compare to other storage devices pen drives are helpful for these target groups in easy way of transferring and storing data.

MARKETING MIX Product / Service Benefits Product Management communicates the market opportunity to the executive team with business rationale for pursuing the opportunity including financial forecasts and risk assessment. Product Management communicates the problem to Development in the form of market requirements. Product Management communicates to Marketing Communications using positioning documents, one for each type of buyer. Product Management empowers the sales effort by

defining a sales process, supported by the requisite sales tools so the customer can choose the right products and options. The business is dependent on one product USB Pen Drive, but since we would offer various product mix to the market such as Normal Pen Drive, Blue tooth Pen Drive, Expandable Pen Drive, LCD Display, Camera, and Pen Drive with MP3 Player and so on., the 80% of major profits are from only Pen Drive which is divided from various product mix combinations in the market PRODUCT MIX: USB PEN DRIVE

Product Line: We are into only one segment i.e. USB Pen Drive Product width: We offer 3 categories of our product i.e. luxury, popular and low end to the consumers. 1. Low end............ Low end segment of USB flash drives/pen drives refers to those pen drives which are priced below Rs 300. It will be of low price and basic features, medium size, easy to hold. 2. Popular.............. Popular segment of pen drives refers to those pen drives which has some special features like Bluetooth and Expandable memory.

3. Luxury................Luxury segment refers to those pen drives which has some special features like LCD displays, MP3 player and Camera. Product depth: Under the low end category we offer pen drive with memory storage capacity of 2 GB. In the popular end category we offer pen drives with Bluetooth and Expandable memory. In the high end segment we offer pen drives with LCD displays, MP3 player and Camera.

Benefits of our product match the customer’s needs and wants. And there are no gaps.

FEATURES

BENEFITS

USB Pen Drive with Mp3 player (built-in rechargeable batteries)

Can store and play mp3 songs. Also can store data’s.

USB Flash drive with Expandable memory

USB Flash Drive with in-built Bluetooth

Can expand their pen drive storage/memory limit

Multiple users can access the pen drives

CUSTOMER NEEDS Two in one. (Data and mp3 player) The battery gets charged when connected to the USB port of the computer.

Customers are restricted with certain storage limits but they are in need of more storage capacity. This expandable memory helps the customers to expand their storing capacity.

Multiple users cannot wait for their turn. They can transfer data immediately with efficient speed.

LCD Displays

Camera

LCD display enables browsing LCD display of pen drive has through the list of songs that you made it a high-end device. User store in pen drive. in need of viewing songs present in the Pen drives.

One of the most advanced features that are available with a pen drive. It is a still camera for a generic use

When the pen drive is connected to the USB port of a computer, it functions as a web cam.

Importance of Service, Warranty ➢ For products of high end includes Camera and LCD display pen drives. Warranty will be

provided to these pen drives are upto 2 yrs from the date of purchase and service will be provided all over in India. ➢ For products in medium end which includes Bluetooth, MP3 player and expandable memory warranty will be upto 3 yrs provided with the services all over India. ➢ Now low end product warranty will be provided upto 5 yrs with service anywhere in India. Product differentiation ➢ As our peer competitors are providing just simple products from the range of 2 GB to 64GB, we would carry the competitive advantage of introducing Pen Drives with features like MP3 player, expandable memory, camera, LCD display and simple Price When marketers talk about what they do as part of their responsibilities for marketing products, the tasks associated with setting price are often not at the top of the list. Marketers are much more likely to discuss their activities rela ted to

promotion, product development, market research and other tasks that are viewed as the more interesting and exciting parts of the job. Yet pricing decisions can have important consequences for the marketing organization and the attention given by the marketer to pricing is just as important as the attention given to more recognizable marketing activities. Some reasons pricing is important, Most Flexible Marketing Mix Variable, Setting Right Price, Trigger of First Impressions, Importance part of Sales Promotions. In today’s competitive markets every customer will compare the price, quality of the given products with another products before taking the purchase decisions, in our case as well every customer will compare the price, quality and benefits from our products with our major competitors like Kingston, Transcend, and SanDisk as well.

“The moment you make a mistake in pricing, you're eating into your reputation or your profits.” Since Diloto is new to the market with new concept technology, our Medium and Luxury Segment products would start its life cycle from the Introduction of Product Life Cycle Stage. So the initial demand for the products would start slowly once the products are known by the market the demand for the products would increase rapidly. And the initial pricing for these Medium and Luxury end segment products would be low due to attract the market after reaching the growth stage of life cycle the price would shift slowly. Here below the proposed prices for the Dilato’s products comparing to its competitors like Kingston, Transcend and SanDisk Kingston Low End Segment

2GB

4GB

8GB

16GB

32GB

64GB

Normal Pen Drives

420

620

1050

1750

4599

9150

Transcend 2GB

4GB

8GB

16GB

32GB

64GB

420

529

944

1725

3799

9599

SanDisk 2GB

4GB

8GB

16GB

32GB

64GB

430

600

899

1575

4725

9600

Dilato's Price 400

Medium Segment Expandable

520

800

1600

4200

9250

No Competition in Market In built memory of 2GB, which can also be expandable with memory cards. Cost Price Rs. 750

Bluetooth

In built memory of 4GB, which allows multiple user access at the same time. Cost Price Rs. 950

Expandable & Bluetooth

In built memory of 4GB, which provides expandable and allows multiple user access at the same time. Cost Price Rs. 1050

Luxury Segment MP3 Player MP3 Player with Expandable

No Competition in Market In built memory of 4GB with MP3 Player facility. Cost Price Rs. 1150 In built memory of 4GB with MP3 Player facility, also has expandable functions. Cost Price Rs. 1650

Camera

In built memory of 4GB with Camera facility. Cost Price Rs. 1600

LCD Display

In built memory of 4GB with LCD Display facility. Cost Price Rs. 1750

LCD Display with Expandable option

In built memory of 4GB with LCD Display facility and Expandable memory functions. Cost Price Rs. 2200

From the above prices in case of the normal pen drives, our competitors have already occupied the market with their offerings which leads the products life cycle to move to Maturity Stage. So these segment products have been priced lesser than our competitors to grab the market share. The overall profit margin is 22% on each product which is distributed as the manufacturer would

carry 4% of profit margin, dealer would have 7% and retailer would carry 10% of profit margin in every low end pen drives product. But in case of Medium and Luxury end segment there are no competitors exists in the market, so the manufacturer would carry the advantage of introducing the products and its proposed prices as well. As per the above Pricing chart the medium segment pen drives categorized in to three varieties, range between Rs. 750/- to Rs. 1050/-. And the luxury end segment pen drives would range between Rs. 1150/- to 2200/- and categorized in to four varieties. Since no competition exists in the market, the demand for these segments products would start slowly and near soon would increase the demand rapidly due to introduction of advance technology pen drives, so initially these segments pen drives have been priced a bit lesser to grab the market, and once the demand is indentified clearly the prices would shift slowly. The overall profit margin is 30% on each product which is distributed as the manufacturer would carry 7% of profit margin, dealer would have 10% and retailer would carry 13% of profit margin in every low end pen drives product.

Distribution To reach end users, businesses need a well knitted network. The network includes Manufacturers, Dealers, Distributors and Retailers that are in business lingo named as “Channel Partners.” The channel partners play a vital role in success and failure of business. They are actually the bridge between vendors and end users thus framing the outline for a company in end users mindset. A distribution channel comprising of right channel partners offers the services to end users at the right time without any delay. A well networked and properly knitted distribution channel plays an important role in enhancement of sales growth. It is the key for resellers to get the real picture and review of the product. Besides, giving them the first step aid in understanding product and answering their queries, the distribution partners bridge the gap between vendors and resellers. They facilitate them with the ability to roll back to the vendors to rectify any problem and also to concentrate on the market with right policies in place. Different customers have different needs and performances Increasing degree of market fragmentation Its hard for a product or brand to be everything to all customers Allows for adaptation of marketing. Customer demands can change a successful position can become absolute after a period of time continuous segmentation efforts are essential required, to hold these successful position

We would follow two different level of channel management such as, Zero Level and Two Level Channels. In case of targeting the Corporate industries we would follow Zero level channel where company’s sales executive would be directly meeting the corporate. But in case of the other segments like targeting Young students, working and business professionals we would follow two level channel where from the manufacturer to Dealer, from Dealer to Retailers and from Retailers to Customers.

TWO LEVEL The segmentation and targeting for our products are Young Students, Business and Working Professionals which can be widely explained through SOD Template below as follow:

SERVICE OUTPUT DEMAND SEGMENT NAME

Domestic

Industrial

SUB SEGMENT

BULK SPATIAL BREAKING CONVENIENCE

DELIVERY/ ASSORTMENT/ CUSTOMER INFORMATION WAITING VARIETY SERVICE PROVISION TIME

Low End

High

High

High

Low

Low

Low

Medium End

High

High

High

High

Medium / High

Medium / High

High End

High

Medium

Medium / High

Medium / High

High

High

Low End

Medium

Medium / Low

Medium

Low

Medium

Medium

Medium End

Medium

Medium

Medium / Low

High

High

High

High End

Low

Medium / Low

Medium / Low

Medium / Low

High

High

PROMOTIONAL SCHEMES Promotional methods it is about stimulating customers to buy a product. It is not designed to be informative – a role which advertising is much better suited to. Sales promotion is commonly referred to as “Below the Line” promotion. Sales promotion can be directed at: ➢ The ultimate consumer (a “pull strategy” encouraging purchase) ➢ The distribution channel (a “push strategy” encouraging the channels to stock the product). This is usually known as “selling into the trade” At the early stage we would direct our sales promotional through Push Strategy to create more awareness, identity, and loyalty towards our products after achieving the good loyalty level; we would diversify our method to Pull Strategy Price Promotions Price promotions are also commonly known as” price discounting” These offer either (1) a discount to the normal selling price of a product, or (2) more of the product at the normal price. We would bring “Introductory Offer” which a consumer get pen drive at affordable price and quality than its competitors, and other price promotion method we adopt, having tie ups with Consumers electronic manufacturers such as Videocon, Onida, Computer and Laptop manufacturers too, where consumers would get special discounts when purchasing our products along with any of these manufacturers products. Customization and EMIs facilities: To attract the market we would bring the new concepts in Pen Drive market which are Customizations and EMI facilities for Luxury Pen Drives, in this the consumer can either customize the product in the form of Color, and packaging styles etc. and also he has the choice of paying through EMIs with his credit cards. COMPETITORS PROMOTIONAL METHODS According to our major competitors such as Kingston, SanDisk, and Transcend, as of now we cannot find any sales promotions initiated by them to attract the market. And to add more fuel, the media advertising activities are also very low when we look at the competitors. So we would carry the competitive advantage of introducing various promotional methods to the market to attract the competitive market. MONEY ON ADVERTISING The consumer market has become highly competitive with a new brand being born almost every day. Irrespective of the kind of product you are looking for, be it consumer durables like

refrigerators, air conditioners, washing machines or fast moving consumer products (FMCG) the number of brands available is truly mind boggling. Naturally it is the prime concern of every marketer to promote their brand as a shade better than the competitors'. Advertising comes in handy here. Advertising is a biggest weapon for a company to create awareness, loyalty, identity, interest and desire in the minds of consumers. There are several reasons for advertising some of which are as follows: ➢ Increasing the sales of the product/service ➢ Creating and maintaining a brand identity or brand image. ➢ Communicating a change in the existing product line. ➢ Introduction of a new product or service. ➢ Increasing the buzz-value of the brand or the company. Print Advertising – Newspapers, Magazines, Brochures The print media have always been a popular advertising medium. Advertising products via newspapers or magazines is a common practice. In addition to this, the print media also offers options like promotional brochures and fliers for advertising purposes. We mainly focus on major daily newspapers such as Times of India, Hindustan Times, Deccan Chronicle, The Hindu, Times Classifieds, Economic Times, and Top Magazines such as Business Line, Fortune, Forbes, Business Week, and Harvard Business Review. The overall yearly cost for Print Media would be Rs. 10, 5, 80280/- and Magazines advertising yearly would be Rs. 1, 50, 1800/(Detailed explanation at Appendices)

Outdoor Advertising – Billboards, Kiosks, Tradeshows and Events Outdoor advertising is also a very popular form of advertising, which makes use of several tools and techniques to attract the customers outdoors. The most common examples of outdoor advertising are billboards, kiosks, and also several events and tradeshows organized by our company. The billboard advertising is very popular however has to be really terse and catchy in order to grab the attention of the passers by. We would initiate our outdoor advertising through Unipole, Bangalore, Bus Stop Hoardings, Railway Station Platforms, Triads, Ebay, and Indoor Advertising. The overall yearly cost for Outdoor Advertising would be Rs. 4, 98, 00,000/(Detailed explanation at Appendices)

IMPLEMENTATION DILATO IMPLEMENTATION PLAN MARKETING PLAN PREPARATION Research design Produce the design to evaluation SWOT analysis on company Research on potential customers Research on customer and determine targeted market Research and determine marketing strategy Prepare financial projection for Dilato

DEC

JAN

FEB

MAR

APR

MAY

JUN

JULY

AUG

SEP

Prepare implementation plan Prepare control and evaluate monitoring PRE-LAUNCH EVENTS Marketing department inform sales department about Dilato product ,and all staff participate in seminar to discuss marketing strategy for 4 days Gather the resource to produce Dilato , ensure enough production capacity Create website for Dilato and launch Create monitoring plan to keep track ROI Distribute Dilato to Retail stores and Corporate Educate and train marketing team on Dilato, Sales strategy and consumer behavioral

Provide support to all distribution channels on advertisement, technical support, and others. LAUNCH Launch Dilato to targeted market Ensure all marketing strategy like advertising, promotion campaign is effective POST-LAUNCH Monitor and control(monthly) the sales, the revenue and compare with forecast figure Ensure constant marketing strategy to gain customers Provide control mechanism to monitor ROI Constant training to customer service on Dilato Upgrade the website about latest info on Dilato

CONTROL MECHANISM AND EVALUTION OF EFFECTIVENESS Moreover, the marketing team also have to implement effective control mechanism and evolution of effectiveness method in order to ascertain the launch of Dilato is successful; the marketing strategies are efficient and progress constructively according to projection especially in sales and penetrating targeted market. The suggested apparatus had been designed to aid the department to evaluate the effectiveness of Dilato marketing plan and objectives are shown below:a. Constant market survey and research such as questionnaire method, observation on

b.

c.

d.

e.

consumer behaviourism will be implemented in order to evaluate the acceptance of Dilato among its customers. Quality Control mechanism also will be introduced in order to monitor the quality of Dilato since this is the debut to the market. This will enable the team to capture any defects, faulty parts that can occur after the customer purchase and use the product. Customer Service and technical support team will be established to aid the customers regarding any problems, defects, technical problems and others. This can ensure the quality of Dialto will not be compromised. The department also will generate and implement comprehensive plan to monitor the sales of Dilato, the re-evaluate the market needs, and prepare marketing strategies to gain more customers in the future. The department will conduct customer survey to obtain report on the customer’s satisfaction toward Dilato to gather suggestion improvements that might be needed to enhance the second generation of Dilato in the future.

EVALUATION AND CONTROL

1. Periodic Review: The activities of the marketing and sales team will be reviewed at the end of each month on terms of targets reached and what is proposed plan for the next month, if they want any changes in the existing system, problems faced by them etc. The report has to be submitted in all respects to their respective team leader which will in-turn would be discussed with the marketing head of the region.

2. Training Needs:

At the end of each quarter a review assessing training needs, if any , will be submitted by all the team leaders to their Seniors so that timely action can be taken to train the sales force and in case there Is requirement of more people it can be done accordingly. 3. Revenue Assessment:

A report has to be submitted by respective department showing all the costs incurred by them post launch of the product and an estimate of budgeted expenditure for the next quarter. In addition there will be a meeting of the heads of all the departments. To ascertain the profitability of the launch and subsequent planning. 4. Reviewing the Supply-chain and Dealer meet: The product manager will organize a dealer meet to assess the stock in hand and the future requirement and problems faced by dealers if any. Further dealers will be updated about the marketing plans company is going to take up to the extent of providing discount schemes or financing the consumers. A report has to be submitted on performance of the channel suppliers and in case there is a need for any deletions, substitutions and leaving out a channel in case of non-performance.

CONCLUSION Pen drive is a portable electronic data recovery device, featured with huge memory capacity enabling to store more than compact discs. While compact discs collect data and restores it in a hard drive, this same work can be done more efficiently using a pen drive, which in comparison stores much more data. Storing spreadsheets, music, films and word documents

in it is an

effortless task. Pen drive has multitudes of advantages. It is compact in size and hence is easily portable, making it convenient to be carried in one`s pocket. On the other hand, the compact discs are larger and brittle demanding cautious handling. Pen drive is also sturdy erasing the rule of breaking, unless an immense weight is exerted on it.

Thus the pen drive is widely used by all the segments because of its above mentioned features.. But they are widely used by the students, business and working particular segment professionals because of their unique needs. Therefore we are targeting this of the people.

From the market and the competitor study we have come to a conclusion that there are several big players in the low end segment of the pen drive industry and hence we expect a minimal growth from this segment. This is the reason why we have priced our pen drives of the low end segment lesser than our competitors by following the competitive pricing strategy. Whereas, the scope in the medium and high end segment is very high when compared to the low end segment as there are no big players in these segments and thus we have followed the cost plus mark-up pricing strategy. Here we don’t look at the market, instead we look at our own cost structure and decide the profit we want to make and add it to our costs in order to determine our selling price. More over there are no innovation in the high end segment and that is the reason why we have brought in many high-end features in this segment. Thus we stand as the market leader in the medium and high end segment with new technologies in our product. And hence we are expecting huge revenue from the medium and the high end segment.

The expected revenue for the business after one year is as follows: Number of Retailers would be 750 in Bangalore for all the three segments and the average price of a low end pen drive will be Rs.500. Based on our assumptions, if one retailer sells 5 units per month then the total revenue per annum would be Rs.2,25,00,000(low end). Similarly, the average price for medium end segment will be Rs.1000 and if one retailer sells 2 units per month then the total revenue per annum would be Rs.1,80,00,000(medium end). And the average price for high end segment will be Rs.2000 and if one retailer sells 2 units per month, the total revenue per annum would be Rs.3, 60, 00,000. Thus the revenue for all the three segments for the first year would be Rs.7, 65, 00,000.

Manufacturer’s profit for the first year The ratio of profit share for the manufacturer, distributor and the retailer in the low end segment is 4:7:10. Thus the manufacturer’s profit share of 4% would be Rs.9, 00,000. For the medium and the high end segment the profit share ratio is 7:10:13. Thus the manufacturer’s profit share for the medium and the high end segment would be Rs.12, 60,000 and Rs.25, 20,000 respectively. Therefore the total manufacturer’s profit for the first year would be Rs.46, 80,000. In future, we would like to upgrade our products according to the prevailing market trends by continuous innovation and R&D.

APPENDICES-I

MEDIA PLANNING Print Media Newspaper TOI – Bangalore

Circulation 2000000

Slot Ad Size: 15* 20 sq.cm

PM

Yearly Cost

342000

4104000

288000

3456000

42750

513000

Placed on Page 2 12 Times a Month

Hindustan Times

Ad Size: 15* 20 sq.cm

(Bangalore)

Placed on Page 4 12 Times a Month

Deccan Chronicle

1333668

(Business Section - South)

Display Color (675 + 750) = 1425 *30 days

1270000

The Hindu

Rs Per Sq.Cm = 1550

(All India)

35 Sq.cm

Times Classifieds

For 25 Lines

(Mum, Delhi, Bangalore)

(950 + 470 + 370 = 1790) * 30

Economic Times

620000

30240

362880

53700

644400

For 25 Lines

1500000

(Mum, Delhi, Bangalore)

756690

10580280

APPENDICES-II MAGAZINE Magazine Business Line (The Hindu Grp)

Slot

PM

Yearly Cost

Weekly Magazine

6200

74400

Ad Size : 15* 20 Sq.cm

15000

180000

28600

343200

30000

360000

50000

600000

All India Fortune

Place on 2nd Page 12 Times a Month

Forbes

Ad Size : 15* 20 Sq.cm Place on 10th Page Ad twice in 3 Months

Business Week

Ad Size : 15* 20 Sq.cm Place on 2nd Page Ad twice in 3 Months

Harvard Business Review

Place on 2nd Page

Ad twice in 3 Months 125150

1501800

OUTDOOR

Outdoor Unipole, Bangalore

Space

PM

Size : 40 * 20 Sq.feet (3nos)

Yearly Cost 3900000

Rental = 1300000(pa) * 3

Bus Stop Hoardings

Near Colleges

1500000

18000000

Railway Station Platforms

All Fast Junctions

1600000

19200000

Triads

MG Road

400000

4800000

E-bay

Internet Ads

200000

2400000

Indoor Advertising

Inside all malls

250000

1500000

3950000

49800000

50000 PM * 5 malls

OTHERS I-BALL KINGSTON TRANSCEND 9% 15% 36% 40%

PREFERABLE BRAND

DIRECT SALES MANGER

SALES TEAM

REFERENCES

Philip Kotler - Marketing Kevin Lane Keller - Strategic brand management George E. Belch - Advertising and Promotion http://tutor2u.net/business/strategy/objectives.htm http://www.scribd.com/ http://articles.themarketingteacher.com/

www.marcommwise.com/sourceindex.phtm http://www.marketingsource.co.uk/ http://marketing.about.com/ http://www.4psbusinessandmarketing.com