Markstrat Simulation Report

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[MarkStrat Report]

[Industry A Team E]

Strategies pursued in Sonite market (Segmentation, Targeting, Positioning)

Original scenario, Period 0

At the beginning of the game, we are given two products in Sonite market: SEMI and SELF. After analyzing their product attributes and market positioning, we found that SEMI did a good job in terms of market positioning, which met the needs of Professionals and High-earners relatively well. This was shown in the high market share of SEMI in these two segments in period 0. On the other hand, SELF has a high-end combination of product attributes with very high base cost, but its attributes do not meet the needs of any customer group, and it only achieves minor market share. Therefore, we used the following strategies to make the decisions.

STP analysis (Segmentation, Targeting, Positioning)

The customers in Sonite market can be divided into five segments: Buffs, Singles, Professionals, High-earners and Others. Each segment has certain characteristics, which can be seen from their ideal values and ideal value evolutions. In the first round, we decided to target SEMI at the Pros and High-earners, which proved to be a right decision before the second round. SELF also had high base cost and high performance, but its sales volume was smaller than SEMI. In order to avoid direct competition of the two products, we wanted to withdraw SELF. After second round, we found that SEMI better met the Pros’ needs than High-earners’. Therefore, we started to invest in R&D to improve the product attributes so that it meets exactly the Professional’s ideal values. With the limited budget, we focused on the key selling propositions, price and maximum frequency, which were perceived with high importance by the Pros. Withdrawing SELF and trading the remaining inventory had brought some losses to us. However, considering the potential gains from selling a better and cheaper Sonite product after investing in R&D instead of investing...
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