I. Executive summary:
A. Problem statement: Optical Distortion Inc.(ODI) is a small new company, not yet in business, with a patent for an innovative product designed to prevent chickens from cannibalism behaviors toward each other. These lenses are used instead of traditional way of debeaking. ODI must develop marketing strategies about targeting, positioning and optimal pricing to launch its new product.
B. Recommendation: The dilemma ODI faces is whether introduce its product at a higher price and continue process its multimarket strategy. Based on ODI limited resources and current situation of poultry industry in United States, ODI should target large farms have 50,000 chickens or over, and focus on the
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4) able to lower price as well as cost with high market power and high rate of market to compete with potential competitors.
D. Conclusions: ODI has sufficient evidence to target large farms have 50,000 chickens or over, and focus on market in California and south Atlantic region in the short term and set an initial high price of about $0.28 per pair. Although it may appear that ODI may have risk of introducing new products, this option is actually safest and most profitable for expected sales and penetration. Risk of reluctance to acceptance new technology, low trained salesforce and new competitors in the future may lead this strategy less efficient. It is suggested that ODI decrease the selling price of the lenses in the long term and focus on improving the quality and services and build a solid premium brand image in order to guarantee market share in the future. It would be better to find multiple ways of advertising and increasing the customers ' awareness and accessibility of products.
Appendix
Table 1: Farm size comparison
Table 2:
Savings calculation between debeaking and lenses
Reduce Cannibalism
Debeaking
ODI lenses
Cannibalism Rate
9%
4.5%
Purchase cost (per chicken)
$2.40
$2.40
Total cost
$0.216
$0.108
Savings (per chicken)
Through this strategy, a strength our company possesses is the ability to offer a premium product for every customer in each segment of the industry. We compete by giving all of our customers the very best, up-to-date products. Another strength is that since we have a premium product line, we are able to charge an above average price to our customers, thus leading to higher profitability in the long run.
Many years ago, backyard chickens were commonplace throughout the United States of America – mainly for nutrition. During that time, backyard chickens were easy to take care of and a small number of them could feed a family with meat and eggs for a bargain. Years later, manufacturing food became the way of life and
Therefore this industry is a pretty good one to already be in, but would be very tough to try and break into. Since established firms do not have to worry about threat of entrants or substitution, they can focus on making their core business practices cost efficient and profitable. Although firms have to deal with high buyer and supplier power, every firm has to deal with these issues. Therefore this leaves only rivalry to compete on, which forces firms to stay sharp, observe the competition, and provide excellent service to the firm’s customers to generate profit.
2.Competitive Advantage – It includes the best product of an Organization in the competitive market.
Considering the marketing segment, we choose the target market from small, medium and large farms. If products are sold to small farms, the sales revenues even can’t cover the cost,
According to the Wholesome Poultry Products Act if Polyface expanded and produced more chickens (>20,000) it would have to outsource the processing of chickens to a certified slaughterhouse. This contract would be expensive for Polyface and would also limit the use of slaughter waste (internal organs) as fertilizer at the
Which of the following represent marketing capabilities at the growth stage of industry evolution? A. Skills in aggressively promoting products to new markets and holding existing markets and pricing flexibility B. Ability to establish brand recognition, find niche, reduce price, solidity strong distribution relations and develop new channels C. Cost effective means of efficient access to selected channels and
Based on the market trend, it is likely the demand for the disposable lens will increase at the expense of conventional lens. Therefore, the hope to increase the sales through the distributors and the introduction of ‘frequent flyers’ scheme is unlikely to yield much result.
Despite this, Chick-fil-A has posted positive increases in revenue all 40 years the company has been in business, many of which have been double-digit increases. These increases may seem extraordinary, but Chick-fil-A has used a strategy that ensures their success. Another factor which has the ability to have a major impact on profitability is the increasing price of chicken. With the increasing popularity of ethanol based fuels – made primarily of corn – it is becoming more costly to feed and raise chickens, whose main source of food is corn. This new demand for corn has increased the price, which is in turn passed onto the next buyer. It is necessary for Chick-fil-A to address this issue and formulate a plan of action to try to combat these rising costs.
•Profitable: one of the key criterions for selecting the above competitive advantages is that the company can introduce them profitably.
This would include human abilities, process capabilities, financial resources, products and services, customer goodwill and brand loyalty.
Clear Vision Inc.'s latest product, Liquid-Drop Contact Lenses, is likely to generate much controversy as it is going to become widely accessible. Even with the fact that the company has a significant number of supporters and customers, the fact that people typically have problems going from a product that they have been used with to something revolutionary makes it likely for the advertising campaign to experience difficulties in the period immediately preceding the product's release.
ODI Managers believe direct sales to chicken farms are the best answer. Salesforce will promote the product targeting first ¡§opinion leaders¡¨ from farms with more than 10,000 chickens, who tend to be somewhat less quick to adopt, but are more likely followed by others. One strategy for ODI is to identify the farmers who are perceived as opinion leaders.
Poultry plays very important role for mankind through food supply, income and employment generation, providing raw materials to some industries, facilitating research works etc. Family poultry makes up to 80 percent of poultry stocks in low-income food-deficit countries (Pym et al., 2006) where owners raise poultry in small numbers ranging from single birds up to a few hundred.
in the international markets. The main objective is to keep the current competitor advantages of