Galicano siton 10 step marketing plan

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10 Step Marketing Plan for Bicycle Corner – authorized reseller of SRAM

Galicano B. Siton Jr.July 2012

http://galicano.blogspot.com

This 10 Step Marketing Plan is part of the mandatory requirements of Prof. Remigio Joseph De Ungria’s AGSB marketing management class.

The data included in this report are based on publicly available data such as those on internet websites, news, package declarations, public reports.

When appropriate, data are “masked” so as not to create unexpected conflicts.

The reports are posted and linked on slideshare, blogs and Facebook so that there is easier sharing among students from different marketing classes.

Disclaimer


1. SRAM X0 are avid mountain bikers2. Need reliable product, long lasting

and serviceable products (NWD)3. Fox racing, Shimano, Suntour,

Magura4. After Sales Service (gap)5. Market size is Php44+M, share of BC is est. Php5.5M(3Cs)

Steps 1 to 5

SRAM XO - Relentless


6. SRAM XO is a top line productthat sells performance

7. Priced at most 10%-15% less than Fox Racing but atleast 20% more than Shimano

8. Uses Print, Distributor Ads & Experiences

9. Distributed at Authorized Resellers10. Uses Differentiation Strategy

Steps 6 to 10

Marketing mix & strategy of SRAM XO


1. Bring Performance and Support to the user (PTM)*

Demographics are from 21 – 35 years old, Male, AB, Single (at heart)

Weekend Warriors and Avid Bikers Once a month, around php3k,

usually looking for items that can be serviced.


2. My PTM’s NWD

Needs from Maslow’s hierarchyWants determine choiceDemands for them to buy the

productNote: There may be multiple answers for needs, wants demands. Of these answers, underline and use bold font for the best answers. See examples that follow


PTM needs to be served and Serviced

7Reference: Maslow’s Hierarchy of Needs Marketing Management, 11th ed, Philip Kotler

I can take any mountain inany given Sunday

I am a warrior


2. Bicycle Corner - customers has needs, wants & demands

Needs: Reliable, brand products that can sustain tremendous use and insane abuse.

Wants: Performance at their fingertips, support from bike shops on using the product efficiently and effectively.

Demands: Products that can be serviced if damaged and can be serviced after its warranty


3a. SRAM X0 has a competitors at their doorsteps

Direct: Shimano, Fox Racing, Suntour

Indirect: Magura, Formula, Fulcrum, Easton

Variables: PRICE, Serviceability, Availability of parts.


3b. Create 2 Positioning Maps

1st Map: 2 x 2 Matrix showing the 2 Most Critical Variables for Consumer choice

This 1st Map should allow differentiation/ non-clustering of the direct competitors

Example: Price vs. AgeSize of bubbles= represent relative market

shares of the brands2nd Map: Functional Benefit vs. Brands/ Variants


SRAM XO is #1 in Differentiation due to is After market service

Price/ service Availability Service

High price

Low Price

Price vs. After sales service

as of 2010

Fox

SuntourShinamnoSRAM


Functional positioning vs. brand map for each bike parts/group

Benefit Positioning vs. Competitor Edge

Functional Use SRAM XX SRAM X0 SRAM X9 SRAM X7 Fox Racing Shimano SuntourDedicated for racingXCTrailAll MountainFree RideDownhillTrekkingRecreationSaves money

as of 2010

Harder to stand out amidst the competitive clutter.


4. Bicycle Corner grabs its market by providing quality After sales service

SRAM provides a customer: Complete After sales service of all

of its products Can Deliver repairs within 3-5 days –

any products sold in the local market Provides a wide range of products

for its intended usage.


4. Positioning – Brand Identifier


5a. Estimate the market size using supplier’s data

In 2011 the company announced the intention to go public. SRAM reported net sales of $524.1 million in 2010, and has grown at a rate of about 16 percent annually in the four years prior to 2010. The company has estimated that it holds about 15 percent of the $3.5 billion bicycle components market.


5b. Estimate the market size using supplier’s data

Sales 1987 $0 millionSales 1994 $25 millionSales 1995 $40 millionSales 1999 $120 millionSales 2001 $120 millionSales 2003 $150 millionSales 2004 $160 million (estimate)Sales 2006 $283.8 millionSales 2007 $356.0 millionSales 2008 $478.4 millionSales 2009 $399.6 millionSales 2010 $524.2 million


5b. Estimate the market size using supplier’s data

References:^ About SRAM^ a b . http://www.findarticles.com/p/articles/mi_qn4155/is_20000727/ai_n13875164.[dead link]^ a b http://www.bicycleretailer.com/news/newsDetail/5451.html^ Will SRAM's Deal With Lehman Brothers Stick?^ "UPDATE 1-SRAM International files for IPO of upto $300 mln". www.reuters.com. 12 May 2011. Retrieved 2011-05-12.^ Sram International Corp S-1 Filing (IPO Registration)^ http://www.fundinguniverse.com/company-histories/SRAM-Corporation-Company-History.html SRAM-Corporation-Company-

History^ http://www.pinkbike.com/news/article1936.html^ SRAM | News and Events | News^ Michael Zellmann (3 June 2008). "RED sees pink". Retrieved 17 April 2010.^ Michael Zellmann (21 September 2008). "Contador wins Vuelta with RED". Retrieved 17 April 2010.^ Gaetan Vetois (30 September 2008). "World Champion Nicole Cook (sp) takes SRAM RED to the top". Retrieved 17 April 2010.^ a b c Michael Zellmann (28 July 2009). "Tour podium covered in RED". Retrieved 17 April 2010.^ http://www.uci.ch/templates/BUILTIN-NOFRAMES/Template3/layout.asp?MenuId=MjExMg&LangId=1^ Michael Zellmann (11 April 2010). "Cancellara Drives RED to First Roubaix Win". Retrieved 17 April 2010.^ http://www.uci.ch/templates/UCI/UCI1 Alberto Contador, 1st overall, 2011 Giro d'Italia/layout.asp?MenuId=MTYwMDA&LangId=1^ Stanford business case: SHIMANO AND THE HIGH-END ROAD BIKE INDUSTRY, CASE:SM-150 DATE: 01/27/06^ SRAM Corporation - Company History^ Chicago Athlete - Feature Article^ a b c d e http://ipo.nasdaq.com/ViewFiling_frames.asp?FileName=0001193125-11-136366.txt&FilePath=\2011\05\12\

&eHTML=&View=html^ http://www.hoovers.com/search/company-search-results/100005142-1.html?type=company&term=SRAM


5c. Estimate the market size using customer data - 2010

1. Usage per month – Bicycle Corner Per person

At least 8 times usage of product/s (average hours of usage per instance is 4 hours)

Part upgrade/replacement/repair Update on part/s information

**does not include “bike to work” users.


5. Based on Bicycle Corner’s rough estimation, SRAM has at least share of 12.5% in the Philippines

1. 2010 estimated sales (from 4 outlets) – 5.5M

2. SRAM estimated market share – 12.5%

3. Estimated Market Size = Php44+


6a. Show how product looks vs. competition


6b. Product Description

SRAM X0 brings the right gear to your most heated trail battles—any terrain and every time. Building an X0 bike is a serious, zero compromise endeavor. Only X0 combines the highest-level technology options with a style that matches you perfectly. A flawless bike needs to do more than just work every ride; it needs to look the part.


7. Price


Front Suspension

Sram (Rockshox)

Fox Racing Suntour (Epicon)

Travel 150mm 150mm 140mm

Suspension Type

Air Air Air

Name Revelation Fox Float 150mm

Epicon

Average Price Php30k Php42k Php10k

Service Yes Yes Yes

Available Parts

Yes Yes No

7. Price


Gruppo Sram Shimano

Use XC/Trail/All Mountain, Free Ride, Downhill

Trail/XC

Material Aluminum, Steel, DOT 5.1, Carbon Fiber

Mineral Oil, Titanium, Aluminum, Steel

Name XO XTR

Average Price Php65k Php42k

Service Yes Some Parts

Available Parts

Yes Some Parts

8a. Which of these modes does your product use?** Pls. rank most used, 1-highest use

Mass1. Advertising (4)2. Events & Experiences (3)3. Public Relation (2)4. Sales Promotion

Personal1.Word of Mouth (1)2.Interactive Marketing3.Personal Selling4.Direct Marketing


8a. Your products Promotions

Advertising, Distributor Posters, Magazines


8a. Samples of Promo

10% off on Cashtransactions

Bicycle Corner


8b. Competitor promo


9. Place

Where is your product available? All authorized dealers

From Ilocos Sur to Cagayan De Oro Online Retailers

Universalcycles JensonUSA Chainreactioncycles

PMTB, PHILMOFO forums


10. What is the generic winning strategy?

Which of the 4 strategies are being used? (bold and underline to most dominant strategy) Low Cost Producer Supply and Distribution Leverage Differentiation Niche


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SUMMARY


1. SRAM X0 are avid mountain bikers2. Need reliable product, long lasting

and serviceable products (NWD)3. Fox racing, Shimano, Suntour,

Magura4. After Sales Service (gap)5. Market size is Php44+M, share of BC is est. Php5.5M(3Cs)

Steps 1 to 5

SRAM XO - Relentless


6. SRAM XO is a top line productthat sells performance

7. Priced at most 10%-15% less than Fox Racing but atleast 20% more than Shimano

8. Uses Print, Distributor Ads & Experiences

9. Distributed at Authorized Resellers10. Uses Differentiation Strategy

Steps 6 to 10

Summary headline of the marketing mix & strategy


Galicano siton 10 step marketing plan

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