Strategic Management Project

Strategic Management Project - Case 2 Target the Right...

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Case 2: Target the Right Market Case prepared by: Cheong Mun Hong I054010143 Chiang Ye-John I054010203 Johnson Ang I054010059 Joseph Chua I054010145 Julian Neo I054010111 Tse Chen Hao I054010134 1
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Introduction - Sparkplace Online-marketing software provider with 2 years of experience in the industry Software is designed to let clients manage and evaluate the effectiveness of online marketing Sparkplace vision for marketing: To attract customers with prior interest in online marketing 2
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Introduction - Sparkplace Sparkplace’s current and potential clientele can be classified into: Small Sams Small with self-employed owners < 20 employees Medium Marys Medium sized with 20 – 100 employees A senior manger deals with Sparkplace 3
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Small Sams and Medium Marys Small Sams Medium Marys Size < 20 employees 20 – 100 employees Potential Market Size 1.3 million < 0.5 million Market Landscape Market leader Fierce competition Avg. Profits in a lifetime $10K / Sam $50K / Mary Total Avg. Marketing + Sales Cost $3,000 $30,000 ROI on each $ spent on marketing $5 $2 Avg. Marketing Cost / Customer $2,000 $25,000 Avg. Sales Cost / Customer $1,000 $5,000 Avg. Profit after Marketing & Sales Cost $7,000 $20,000 Avg. Customer Life Cycle 3 months Long-term Software feature preferences Simple Complex + Aligned with potential of 4
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Should spark place go after Small Sams, Medium Marys, or both? 5
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Key Assumptions 1)Marketing and sales costs are the only costs incurred in securing and providing the service to customers (ignoring development and maintenance costs) 2) Time is not a limiting factor in acquiring customers 3) Avg. Sales Costs for both Sams and Marys includes sales that have not succeeded.
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