What are the key marketing challenges facing Gauri Nanda and how would you prioritize them? 1) Timing Clocky got a lot of media attention approximately a year early from commercialization. The hype it is having might have a negative and positive affect towards when actually Gauri introduce the product to the market. The questions raised was “Would consumers interested in buying Clocky now be frustrated once they learned that the product was not yet commercially available, or would they be content to wait until Clocky reached the market? ” 2) Target market
Gauri have to decide whether to focus on “Fun” or “Need” target segment.
This is a critical step in the development as it will be difficult to change perception of a product once it gains a certain reputation. 3) Production partnership Gauri have to make a decision whether to partner with a large-scale retailer (Wal-Mart) or to pursue co-branding opportunities with a product development outfit ( iRobot). Both ways offer it’s up and down sides. With a large scale retailer, Gauri face the risk of the product becoming a fad, like Tickle-Me-Elmo.
On the other hand, pursuing co-brading opportunities, she might have less control over the product invention. 4) Pricing Gauri have to decide the price for the product. This also will determine the product strategy adopted. Selling to Wal Mart allows Gauri to cash in early but sacrificing the long term potential of the product. Whereas selling to a upper class store allows Gauri to build brand image but it may take longer time to generate enough profit to recoup back the investment. Gauri needs to tackle the challenges from 1 to 4.
I feel that the early media attention issue need to be taken care of first and make sure it does not negatively affected the commercialization of the product. Secondly, Gauri needs to determine the target segment which will lead to production partnership decision and ultimately pricing. How would you segment the market for Clocky and on which target market segment(s) should Nanda focus. Explain the value proposition for each? In the article it is mentioned that Clocky’s customer can be put into two camps: “Need” and “Fun” market. ) “Need” market The main customer would be people who found getting out of bed is a serious challenge and disrupted their life in significant ways, such as frequently making them late for work. I feel like Clocky will be a success in this market as it will be seen a solution for those people. In addition to that, the market is currently untapped and Gauri will enjoy first moving advantage. The downside is that the market is not as big as the other segment. Although the probability of success is high, the financial gain might not be significant. ) “Fun” market The customer would be people who currently use an alarm clock. I can see that Clocky will be marketed not a solution but as alternative to tradition alarm clock that has more advance feature. This way there is a risk that the product will be seen as a fad product just like Furby. However, the market is huge and financial gain is significant if the product is a success. Personally I feel the best strategy is for Gauri to focus on short term financial gain and focus on the “fun” market.
There is a big chance that the product might have a short life, like furby but Gauri would be able to gain a significant financial gain in a short period of time. The need market is not very attractive to me because of the size of the market. Based on what you believe to be the most feasible/most valuable positioning, what are the key components of a marketing launch plan including: product design/features, pricing, retail channels and distribution plan, manufacturing location, and marketing communications. My goal with this product would be to generate as much profit as possible in the shortest amount of time.
I do not think building a brand and spend years on this product is worth the effort from financial perspective. With this in mind, the strategy that I would adopt is a short term strategy that will maximize short term profit. The segment I would be targeting is the “Fun” market. I would market Clocky as an advanced alarm clock that is innovative and “fun” to have. The feature would be kept at the minimal (moving alarm clock) and the design would be as describe in the case “lighthearted features, such as his furry exterior and playful nature, depicting him almost as a robotic household pet. I would form a partnership with Target and use them as the main distribution channel. The pricing would be set a low point around $30 (considering that traditional alarm clock sold around $15). With Target’s mark up around 144%, the retail price would be $40. The manufacturing location will be in China as it offers the lowest cost of manufacturing. Assuming the cost of goods is $15, this will offer 100% margin. The media communication used would be TV and magazine advertisement. The advertisement is catered toward general audience that buy alarm clock.