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Secure, Sealable SuitcaseConkle, Paige; Couch, Aaron; Dibba, Marissa; Enerson, Josh; Foner, HeatherBemidji State UniversityTable of Contents TOC \o "1-3" \h \z \u Table of Contents PAGEREF _Toc481093462 \h 2Abstract PAGEREF _Toc481093463 \h 3Mission Statement PAGEREF _Toc481093464 \h 4Business Objectives PAGEREF _Toc481093465 \h 4Concept Testing PAGEREF _Toc481093466 \h 5Concept Testing Review PAGEREF _Toc481093467 \h 5Marketing Mix PAGEREF _Toc481093468 \h 5Product PAGEREF _Toc481093469 \h 5Price PAGEREF _Toc481093470 \h 6Place PAGEREF _Toc481093471 \h 7Promotion PAGEREF _Toc481093472 \h 8Value Proposition PAGEREF _Toc481093473 \h 10Competitive Review PAGEREF _Toc481093474 \h 10SWOT Analysis PAGEREF _Toc481093475 \h 12Strengths PAGEREF _Toc481093476 \h 12Weaknesses PAGEREF _Toc481093477 \h 12Opportunities PAGEREF _Toc481093478 \h 13Threats PAGEREF _Toc481093479 \h 13Market Segmentation PAGEREF _Toc481093480 \h 14Geographic PAGEREF _Toc481093481 \h 14Demographic PAGEREF _Toc481093482 \h 15Psychographic PAGEREF _Toc481093483 \h 15Behavioral PAGEREF _Toc481093484 \h 16Positioning PAGEREF _Toc481093485 \h 16Differentiation PAGEREF _Toc481093486 \h 17Branding PAGEREF _Toc481093487 \h 17Packaging & Labeling PAGEREF _Toc481093488 \h 18International Expansion PAGEREF _Toc481093489 \h 19Sustainability PAGEREF _Toc481093490 \h 20References PAGEREF _Toc481093491 \h 22AbstractThe basis of this project is to create a new product innovation to bring to market. Our group came up with space-saving, one-size fits all, mid-grade designer bag… SpaceCase?. This marketing report includes concept testing, industry research, sample promotions, branding, product descriptions, price and segmentation.Mission StatementOur mission is to make travel about the destination. By eliminating common travel issues, we provide solutions that make your journey simple and deliver endless value while fulfilling our brand promise.Business ObjectivesProfitable Growth - By increasing our revenue and limiting expenses this makes our operation profitable. This can happen through reaching a provided percentage of our target market, through decreasing operational expenses by creating an efficient environment, and maintaining or exceeding sales goals put forth each quarter. Customer First - Providing customer service that is geared towards the needs and wants of the customer. This happens through feedback and providing timely responses to customer questions and concerns It is not just listening to the customer but understanding them. Engaged for Growth - To hold a higher degree of employee retention. We value knowledge and expertise gained through experience. By providing positive work environments, that meet the needs of our employees, we hope that our employees will choose to stay with us for an extended period of time. Allowing our employees to have a voice is a key to the innovative impact in our organization. Raise the Bar - Providing a foundation that supports organizational growth. With exceptional customer experience, we expect the value and satisfaction of our products and solutions to spread. Through positive word of mouth, as well as customer driven marketing avenues, more doors open for our organization. Provided given feedback, we may broaden our product lines in the travel market to meet market demands. The possibilities are endless.Concept TestingConcept 1. Compartmentalize your belongings in a space saving suitcase designed to carry more but spend less on baggage fees, including accessories needed to deflate compartments with ease.Concept 2. An affordable one size fits all suitcase designed to save space while not in use.Concept 3. Fashionable travel comes in all sizes but doesn't have to come in multiple pieces.Concept Testing ReviewThe reviews from the discussion board stated the concerns about the size of the pump that would be installed within the suitcase as it would take up some of the space as well as add to the weight of the suitcase overall. A suggestion to this problem was to have a built-in air system that could just be plugged into and used to remove the air like a different form of air mattress. The idea of the crank was also a concern when considering someone using our suitcase who wouldn’t be able to crank it to complete the flattening technique. One main concern was based on the security of our bag when being checked at an airport facility. Would the airport be okay with the extra technology being in the luggage? The discussion boards were filled with overall support of the idea of saving space when having limited amount of space in an overhead compartment or under the seat, where the airline attendant suggests you place your luggage, is rated very high and seen as a major improvement with our suitcase concept as well as the ability to collapse it and store it when not in use.Marketing MixProductThe last suitcase you'll ever need! The revolutionary and secure SpaceCase boasts a lightweight, versatile design any traveler will appreciate. Constructed of PVC honeycomb sides for rigid durability and designed with chic nylon fabrics. Best of all, the SpaceCase easily expands and contract to accommodate multiple sizes, from 21” carry-on to 27” check-in. When 411480090170000not in use, the SpaceCase easily folds down to reduce needed storage space. Features:Built-in space-saving sealable bagsIncrease space within the suitcase without messOrganize your belongings without damageSave space when not in use with the collapsible and expandable designBuilt-in accessories for ease of use.PriceSpaceCase is designed to compete in the mid-market, designer style market. Based on research from the competition, our price point ranges from $150.00 to $400.00 depending on the market conditions in the area along with the product options included in the SpaceCase product line. This pricing is approximately 25-percent less than Samsonite which is a strategic move. Being a new brand, and a new style of luggage, we want to reach the same target market as Samsonite, but give the buyer incentive to purchase SpaceCase, feel safe in their choice and get more for their money. This pricing is an introductory rate, when the brand gains more momentum and brand awareness, we will be able to increase the cost. Based on pricing from , our competitor’s price, for 21-inch canvas style, upright, spinner carry on style is as follows:Briggs & Riley: $300.00 to $519.00 MSRPHartmann: $299.99 to $695.00 MSRPSamsonite: $199.98 to $449.99 MSRPTumi: $545.00 to $745.00 MSRPAs a new type of luggage, expandable, our competitive price analysis is not completely apples-to-apples as it is a combination of carry-on size to check-in size. Traditionally, the check-in sized luggage is almost twice as expensive as the carry-on, however, our goal is to capture the sales of both, utilize our streamlined manufacturing to drive down production costs by manufacturing the same product for both purposes.With that being said, the pricing strategy that we will use to introduce our product into the market is market-skimming. One thing that helps companies survive is their strive for innovation. Coming up with new and better ways to do things, in terms of product, will always be a main goal within any organization. On that note, when we come up with an adjustment or innovation, to our current problem, the price on our older products will be reduced. This will help us to sell our new products while pushing to dwindle on standing inventory of our older products. Thus, allowing us to price skim the entire, targeted, market spectrum. Reaching as many customers as possible while maximizing our returns on investment. PlaceThere will be two main avenues to purchase our product. Our product can be purchased on our company website, where we can run specials and sales as we see fit. As well, our product can also be purchased at selected retailers such as, but not limited to: Sears, Macy’s, Target, Wal-Mart, etc.… The channels that will be used would include direct avenues as well as indirect avenues. Through direct avenues, our customers can come to us direct for products or customer service. This will allow us, to a degree, to cut out the middleman. Thus, allowing us to maximize profits whenever the opportunity presents itself. However, not every customer uses direct avenues to purchase products. Therefore, creating a barrier between producers and consumers. To combat this barrier, we will use both full-service wholesalers and wholesale merchants. Each type of wholesaler specializes in given areas that may assist in adding value to our product. Through full service wholesalers, the wholesalers will buy inventory from us, directly, at a wholesale price, and re-distribute our products to the consumers through their own sales avenues, lines of credit, delivery systems, and customer service departments. As well, we will use wholesale merchants. This type of wholesaler will buy our products at wholesale or at a deeper discount, provided a given number of units ordered (the more ordered, the larger the discount). In turn, the wholesaler will then distribute the product through their own avenues of provided retailers, at a slight increase from what they paid, thus creating a marginal profit on their end while assisting in the sales of our product for our end. In other words, they would be a middle-man providing our company with access to retailers that we, otherwise, would not have access to. Through direct retail sales, as well as multiple, indirect, wholesale avenues, our company can capitalize on as large of a portion of the market as seemingly possible. PromotionTwo forms of marketing communicational mixes are going to be used in the selling of our sealable suitcases: direct and digital marketing and sales promotion. The direct and digital marketing form of promotional mix was chosen for our product because we are targeting and engaging directly with individual consumer needs, as well as certain consumer communities, in order to obtain the immediate response needed for our product to sell. Examples of this are paid ads, Google Shopping Feed, e-blasts to our valued customers, remarketing with Google AdWords, and ads on social media on sites such as Facebook. This will result in the building of and maintaining of future consumer relations and brand building of which this form of marketing allows. The second form we have chosen is the sales promotion marketing communications mix. Sales promotion gives SpaceCase the opportunity to expand our market sales as well as offer short-term incentives to our targeted consumers. This will be accomplished through manufacturer rebates and summer buy programs and co-op ads with select major retail chains. This provides our customers with reason to gain the courage needed approach for a new product and provides the consumer with a firsthand experience into our sales and services. Through direct contact and sales advertising, we introduce ourselves on a more personal level and allow our customers to get to know us. Once we provide our customers with a positive experience, we can expect to see growth within the sectors we provide service to. center10287000Value PropositionTravel, without baggage. No matter how often it’s used, our space saving suitcases are made to be reliable and durable while keeping travel simple. As well, our aim is to reduce needed storage space when not in use and provide more “smart” space while traveling. Competitive ReviewSales of Travel Luggage and Accessories have been and continue to be on the rise. As well, luggage companies continue to flourish as they innovate to produce new concepts that provide the lightest and most convenient way to travel today. Some of these suitcases have undertaken many alterations since their original designs over the years. Alterations that would include but are not limited to: changes in materials to provide for a lighter weight, overall durability of the cases, and the range of colors available. These enhancements are made to try and bridge the gap between the suitcases that people can carry onto the aircraft and the bags they are forced to store below.Pricing for this product are variable. Suitcases can be purchased based on the individual needs of any one person or set of people. Organizations can also place a lot of variation, when it comes to their bags, based on the brand names provided. This being due to many countries having their own rating systems. The price for the average carry-on suitcase ranges from $30 to $500 depending on the accessories available and the individual needs of the consumer.● SpaceCase - Created in 2017 in Bemidji, MN as a new product to provide a new way of compressed, in addition to organized, way of traveling. The SpaceCase is a suitcase that is available in many different colors, providing lightweight sealable compartments while maintaining fashionable interior designs.● Briggs & Riley - Briggs & Riley is a New York based premium luggage brand. Known for its “Simple as that” lifetime guarantee, it covers all damage to the suitcase, even that caused by airlines. With the company’s headquarters residing in Hauppage, New York, Briggs & Riley is owned by US Luggage LLC and is sold through retail and online boutiques in North America, Asia, and Europe. According to China Money Network’s Article Briggs & Riley Launches Official WeChat and Weibo Presence (2016, May 19) Briggs & Riley is experiencing growth, in the luggage and travel accessory industry, at a 16.9% growth rate, double that of the industry standard. Their success is due in part to continued globalization, changing their distribution strategy, and new product innovations for the adventurer.● Rimowa - Created in 1898, in Cologne, as a new design with the incorporation of grooves. The first of these suitcases were made of wood with many still being created using such materials today. In 1937, the founder’s son Richard Morszeck, launches the first aluminum suitcase. The improvements continued development throughout the years and included: waterproofing, ball bearing-mounted multi-wheel systems, being fitted with innovative TSA-approved locks, and providing the first use of polycarbonate in luggage production. All revolutionizing the materials used within the industry.● Samsonite - Founded in 1910 by Jesse Schwayder. At its 100-year anniversary, Samsonite rebranded and changed its focus from luggage to travel accessories. Today, Samsonite is the world’s largest travel accessory company (Hoover’s Samsonite International SA Company Information) holding 3.6% of the global market overall. According to the Samsonite 2015 Annual Report (2016, April 22) Samsonite’s 2015 annual sales are stated to be $2,432.5 million; a 3.5% increase from 2014. With over 100 retail, international, locations, Samsonite’s market sales for 2015 are as follows: Asia - 39%, North America - 33.4%, Latin America - 22.4% and other - 5.2%. Samsonite, along with its “group” includes; Tumi - acquired in August 2016, is its luxury brand, American Tourister? - it’s entry level brand, Hartmann?, High Sierra?, Gregory?, Speck?- it’s slim mobile device line, Lipault? - chic and youthful European brand and Kamiliant?.SWOT AnalysisStrengthsReduced Costs - As a smaller, new start-up company, we have reduced overhead pany Culture - A customer satisfaction driven culture will ensure that our product meets the needs and wants of the consumers we aim to reach.WeaknessesNew Brand - SpaceCase, as a new brand, has little to no market recognition. In order to generate revenue, we will have to put forth a large marketing effort to gain brand awareness and consumer petitive Market - The market is flooded with multiple competitors, each one with their own niche. Local brands dominate the low-end market, while larger brands such as Samsonite, and dominate the premium market. All the while, designer labels dominate the high-end market.Distribution Network - As a new brand, we will have a limited distribution network. We will need to identify strategic partnerships with manufacturer’s reps in order to grow this area. We will also want to focus on building relationships with companies, such as Amazon, to take advantage of their broad reaching distribution networks.Geography - With a limited distribution network we will have a small geographical footprint. This may affect revenue if the local economy and employment rates worsen. We will want to focus on expanding our geographical footprint to diversify in order to allow for greater success outcome.Product Portfolio - With a limited product portfolio, it may be difficult to sell the SpaceCase. We may need to develop strategic partnerships in order to sell a package deal. This is especially important for retail space.OpportunitiesBarriers of Market Entry - A market with such capacity holds more than enough room for newcomers.Market Outlook - The market outlook is expected to continue to grow, 8% in 2017, and continue throughout for the foreseeable future.Patent - The patented design of the expandable feature is a barrier for competition. This is also an opportunity to sell or broker deals with major luggage manufacturers.ThreatsMaterial Cost - High profile materials, such as leather, tend to be costly. This can be combated through the use of dense/durable materials such as canvas.Trends - Trends tend to change as cultures change. The weight added to the importance of given things tends to change. We can battle this by remaining innovative, welcoming change with open arms and adapting to fit.Regulations - Changes to airline standard practices, FAA regulations and international customs departments may influence product design, specifications, and materials.Patents - We must be careful not to infringe on any legal patents put forth by regulation. As well, we must ensure that our patents are of legal petitors - Competitor innovation may put us at a disadvantage. This may include price, aesthetics, patents and features.Market SegmentationTraveling is something almost everyone will do at some point, because of this the market is very large and diverse. Our product holds value to all travelers, but since the market is so large we need to determine specific target markets to promote our product. Our geographic targets include North America, Asia, and Europe since they provide the wealthiest and most frequent travelers. However, since traveling takes place all over the world our product is available online so everyone has access to our product. For demographic purposes, targeting a specific age group would be difficult because it would always leave out a large portion of the market, which demands us to cover all age groups. Because of this it would be most beneficial for us to target a social class, the middle class as well as the higher lower class, since our product would fit their price range. It also makes sense for us to target a certain travel lifestyle, such as leisure and business travelers since they occupy most of the travel market. Choosing specific target markets is difficult for traveling because of the wide range of diversity, but it is necessary so we can properly determine the markets with the largest sales opportunities. GeographicSpaceCase will be available for anyone across the globe. Primarily it will be sold in retail stores, but customers will always have the option to buy online. The major geographic markets we will target are North America, Asia, and Europe. These continents provide consumers that are the wealthiest and most likely for repetitive travel. Manufacturing, as well as main distribution is located in North America. Within the next 3 to 5 years, our goal is to seek strategic partnerships in Asia and Europe for distribution. Thus providing us with a sample or test as to how those markets run while leaving the possibility for international expansion open. Our plan is to have our product carried in popular retail stores in larger cities within these continents that provide to large markets. It would be too costly to make our product available in every city, so we believe that by selling our product in larger markets we will maximize the amount of consumers available to purchase our product. DemographicWhen it comes to age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, or generation, there really isn't any true way of segmenting the market for travel and whom exactly purchases more luggage. The older generations seem to have more time to travel more frequently than the younger generation, but the value of our product falls equal to all age groups. The largest factor for determining our demographic market would be income. Lower and middle class consumers make up the largest portion of the populations. They would also, generally, be the most concerned about saving money on extra baggage fees. So if our product is within the price range of most lower and middle class consumers, we will cover a large portion of the market; supplying to those who would most value our product. PsychographicTravelers are one of the most diverse consumer markets. Since almost everyone travels it is important for us to consider who or what type of lifestyles would find the most value in our product when considering the target market for our product. Business and leisure travelers consume the largest portion of the market; both lifestyles fit our product offerings. Business travelers would value our product because it is lightweight and durable enough for frequent travel use. It also allows them to fit all necessary belongings in a bag small enough to carry onto the flight. This helps them avoid checking a bag, saving the consumer time and money. The same goes for leisure travelers. Leisure travelers value the SpaceCase because they can bring just about anything they want without worrying about traveling with multiple luggage bags. These travelers would greatly benefit from our product. With that being said, since they consume such a large portion of the traveling market, it makes sense to target these lifestyles when promoting our product. BehavioralWhen determining our specific target market, we factor geographic, demographic, and psychographic variables, but we do not find it necessary to look at behavioral traits. Traveling does not usually bring different behaviors to consumers, as they are traveling for one reason, to get to their destination. Trying to pinpoint specific behaviors of travelers does not benefit our marketing strategy because there are so few behaviors, if any in the traveling market. Instead, it makes more sense for us to focus on geographic, demographic, and psychographic traits because they consider the largest groups of consumers to target. PositioningThe SpaceCase suitcase brings a “More for the Same” positioning strategy to the market. While the price may be similar to many of our competitors, the features are dramatically better. Our suitcase is durable, fashionable, and comes with space-saving features that have never been used before in a suitcase. This creates a lot of costs to build the SpaceCase, but not to the extent to where those costs would place our product out of the price range of our competitors. This clarifying the “same” for the price. When it comes to what our product offers for its price, the space-saving features are enough alone to bring “More” value than our competitors at a similar price. Not only will our customers enjoy an easier time traveling with the SpaceCase, in terms of packing reasoning, but they will also retain less stress through knowing they chose a durable product.DifferentiationLuggage companies offer many similar traits for their products. Most companies try to promote their style and durability. SpaceCase shares these features in our product, but includes a lot more than just this. Our product is different than any other on the market because of our space-saving technology. The SpaceCase is the first of its kind to offer a product that, not only allows the consumer to pack more while using less space, but also provides a peace of mind knowing it's small and light enough to bring with them wherever they go. All the while remaining durable enough to protect their belongings. Not only does our suitcase save space for the consumer, when they travel, with its expandable and collapsible design, it continues to be beneficial to the consumer when they are packing it away in storage. Not only do the features of our product set it apart from the rest of the market, but we stand behind our craftsmanship and brand. We believe that it is only right that our product is durable enough to last through time, if it does not we will not hold the consumer responsible. It would be too costly for us to replace any SpaceCase that becomes damaged over time, so instead we came up with a warranty that is still fair to the customer, and still beneficial for us to keep loyal customers. We came up with a unique limited-lifetime warranty. If the product is damaged within the first year of use, we will replace the product at no cost. If the product is damaged within the second year we will cover 80% of the cost of a new SpaceCase, in the third year we will cover 60%, and in the fourth year we will cover 40%. Anything after the fifth year we will cover 20% of a new SpaceCase. With this warranty we believe we are being fair to the customers, while still not hurting our own profits. BrandingOur brand name for the expandable suitcase is SpaceCase. One variation of our logo includes a globe with our established year and out brand name, SpaceCase, inside a classic diamond shape. This variation is the emblem on the luggage. Our branding colors are white, black and gold accents to give a clean, upscale aesthetic. Using these neutral colors allows our product designs and fabric patterns to shine. When our customers see our branding we want them to feel trust, warmth and balance… a safe choice. Packaging & LabelingThe packaging and labeling of the SpaceCase luggage includes a wrap graphic across the front of the suitcase, from hinge to zipper, identifying the product name and high level features. Attached to the zipper is a branded fold-over hang tag which features a brief company statement 45775046597650Sample Instructions00Sample Instructionson service and quality. On the back side is a label with the item number, model, UPC barcode and price. On the inside of the luggage is an owner’s manual that includes the full warranty, customer support information, along with features and instructions on expanding and contracting the bag for storage.International ExpansionOur plan for SpaceCase is to consistently market our products to the international market. Although our primary market is the United States, due to the U.S. being the country of origin, we plan to promote our products in Asia and Europe in once our product gains brand recognition and market share. Our three main continents are North America, Europe, and Asia, however, our product is available to everyone in the world through online sales through . These geographic areas are the focus because they are the wealthiest continents, as well as the most likely for repetitive travel. In addition, our psychographic target market is directed towards business and leisure travelers alike. These continents hold the largest average travel rates overall while providing the perfect market space for our product to thrive.The main distribution for the SpaceCase is located in North America, but if our product is successful in Asia and Europe, our plan is to build additional manufacturing plants on both of these continents. We believe that introducing our product internationally should not be very difficult because travel is a global market, and anyone who travels can benefit from the use of our space saving product. In the future we would like to expand to more continents and countries. However, during the beginning stages of our business expansion, we believe that Asia and Europe will provide the lowest amount of risks while providing larger rewards in return. SustainabilityWhen it comes to our sustainable marketing plan, we as a company believe our internal values for our product will be accepted socially and environmentally by most consumers. The SpaceCase is a product that is made to last for a consumer as well as being made from post-consumer recycled plastics and renewable fabric materials. This benefits consumers by allowing them to not having to worry about purchasing new products and throwing away old and worn out suitcases on a frequent basis. Not only do the consumers benefit from the durability of the product, but also the, most important, space saving features that allow the consumers to carry less luggage while traveling. This is environmentally efficient not only for the sake of not needing as many resources to travel, but also for the fact that our company provides durability in our product which reduces the amount of waste from old suitcases.SpaceCase provides its consumers space saving benefits while traveling. This reduces the amount of space needed for storage and provides an opportunity to save on fees by not needing extra luggage while saving airlines and their passengers unnecessary fuel charges. With these benefits our product will be accepted socially and economically by our consumers. Our product holds few, if any, negative aspects, which will be positive for our marketing goals. Although there might be negative feedback from airlines from the loss of extra travel fees with the use of our product, our goal is to benefit the consumers, and with what our product has to offer the consumer, that is what we will do. References(2015, August 26). Samsonite International S.A. Announces 2015 Interim Results Strong Constant Currency Net Sales Growth Across All Regions [PDF document]. Retrieved from (FINAL%20-%202015-08-26).pdf (2016, April 22). Samsonite 2015 Annual Report [PDF document]. Retrieved from (FINAL%202016-04-22).pdf(2016, May 19) Briggs & Riley Launches Official WeChat and Weibo Presence. Retrieved from .(n.d.) [web content]. Retrieved from (n.d.). Retrieved from .(n.d.). Retrieved from (n.d.). Retrieved January 20, 2017, from (n.d.). Samsonite International SA Company Information. Retrieved from (2012, January 26). Piquadro Spa – Competitors, Market Analysis & Strategies. Retrieved from ’Leary, Noreen (2010, January 5). Briggs & Riley Unpacks Outdoor Luggage Line. Retrieved from . ................
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