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You are a team of entrepreneurs with a fantastic business idea: A Subscription Box for gaming.
You plan to pitch your idea to a group of investors ala Shark Tank. Your pitch is in the form of an oral presentation, limited to 20 minutes MAX. The presentation should highlight the conclusions from your business analysis, go-to-market strategy, and reflect the principles of CRM marketing.
Presentation should include:
1. Business Concept
This is a topline description of your business idea, the service or product, the target demographic, and a unique selling proposition that will give your company an advantage over its competitors. This should also include a business/product/service NAME and high-level brand description. The only requirement is that your business concept be a
2. Customer Target(s)*
Define the business’ demographic and psychographic customer segment profile(s). Include a deep
analysis of your target audience including but not limited to estimated volume of potential customers, demographic
breakdown (age, gender, income, education, etc.) and psychographic breakdown (interests, hobbies, professions, media
usage, etc.). Use KU Library resources to refine your target customer description; consider secondary research (surveys,
questionnaires) to enhance your understanding of the target customer’s needs, wants, desires, and willingness to try your
product or service. Consider developing a Customer Journey and/or Customer Lifetime Map to enhance understanding of
how product or service fits in your target customer’s life.
Define the market in which your business competes. Who are the key competitors? How does your product or service compare in price, value, and brand promise to the competition? Are there any differences in target customer profiles? Consider including a competitive landscape map to visually show how your business concept takes advantage of a market
4. Acquisition Strategy
How will you acquire customers to sign up for your subscription business? What media outlet(s) will
you use? Research advertising options against your target market and selected media. Define your media
cost-per-acquisition by calculating your media costs against your assumed conversion rates. Identify the sources you are
using to make sales conversion assumptions.
Do not waste time obtaining “real” media pricing. For the purposes of this
project use Subscription Box Media Pricing Assumptions to calculate advertising costs.
5. Retention Strategy
How will you retain and grow your customer base through any combination of product and sales
promotions? How will you communicate with your customers? What are the costs of those communication methods and/or
promotions and discounts? Research marketing communications tactics and determine the cost of retention marketing
against your target audience.
6. Financial Model
Research the wholesale cost to create/manufacture, package, ship, and service your product or service.
Layer in the cost of marketing acquisition and retention costs. Develop a break-even analysis that shows how many units you need to sell before you break even on initial startup costs. How does that unit volume change when marketing, advertising,
and overhead are included? Show how differing customer retention rates affect profitability analysis. What assumptions do
you need to make to break-even on your startup expenses within 12 months? What assumptions do you need to make to
break-even on your startup expenses within 24 months? How long before your business will become profitable? Assume
annual overhead costs = 10% of business’s annual wholesale production costs. Okay to assume web hosting, insurance,
office supplies and facility management included in overhead expenses.
See “Simple P&L for Sub Boxes” excel file for template.
*Under absolutely NO circumstances, should your target customer be “college students aged 18-21” or “adults 18 – 49.”
Creating a product or service targeted to either of these “target” audiences will mean an automatic grade of 0/100 points.
The point of this assignment is to align a business product or service with a well-defined target audience. The best marketers learn to look beyond their own demographic profile and research customer targets unlike themselves. In addition, targeting a non-specific overly generic audience like, “adults 18-49” do not achieve the assignment goal either. The best business
models target highly specific customer segments.