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Star Marketing Spend Effectiveness

Star Marketing Spend Effectiveness. Who Are We?. Kent Van Horn Kent is a junior economics student at the Krannert School of Management. He is also majoring in Management. . Dan Schwartz Dan has completed his first year of the MBA program at the Krannert School of Management. His

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Star Marketing Spend Effectiveness

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  1. Star Marketing Spend Effectiveness

  2. Who Are We? Kent Van Horn Kent is a junior economics student at the Krannert School of Management. He is also majoring in Management. Dan Schwartz Dan has completed his first year of the MBA program at the Krannert School of Management. His Concentration is in operations. Previously, he worked as a project manager at General Electric and as a consultant at Total Quality Logistics, a 3rd party logistics provider.

  3. Lets Look at the Agenda… • Industry Analysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  4. What is the Problem?

  5. Two Wheeler Economy Segment

  6. Agenda • IndustryAnalysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  7. Marketing Microenvironment

  8. Economy Segment Marketing Mix

  9. Market Segmentation

  10. Who is Our Target Group? Key Takeaway: TVS Sport targets a younger, wealthier market

  11. Situation/Opportunity Analysis Strengths • Brand awareness • Reliability • TVS brand name Weaknesses • Price point • Fuel economy • Limiting design • Price conscious consumers Opportunities • Sell on reliability • Differentiate from competitors Threats • Quality not perceived by customers

  12. Macro-Environment

  13. Market Analysis Key Takeaway: Concentrated market with few players

  14. Market Analysis CD Deluxe Splendor Star City Plantia Sport Key Takeaway: TVS products are differentiated in this segment

  15. Agenda • Industry Analysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  16. Look at the Distribution Channel TVS Dealer Customer (Urban) 30% Sub-dealer Customer (Rural) 70% Margin split 50/50 between dealer and sub-dealer

  17. Comparing Retail Sales Vs. Traffic Key Takeaway: Retail Traffic and Sales are closely related.

  18. Agenda • Industry Analysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  19. Head Effectiveness Regional spend compared to sales: Correlation = R2 Highly correlated spends have highest effect Y=m x+b Positive m values indicate sales increase Negative m values indicate sales decrease Both advertising and promotion

  20. Brand vs Promotion

  21. Brand vs Promotion

  22. Weighted Sales • Method to compare sales: Weighted Sales = 0.5 x Month n Sales + Month (n+1) Sales + 0.5 x Month (n+2) Sales +0.25 x Month (n+3) Sales

  23. West Bengal Regression Analysis Key Takeaway: Print, advertisements, demos and hoardings appear to increase sales. There is a strong correlation between all India sales and West Bengal. Too many variables makes a difficult to use model.

  24. What About Tamil Nadu? Sales = 4004 + 0.00014 x Weighted TV Spend + 0.00074 x Press Key Takeaway: For every 1500 Rs. Spent on press, TVS can expect one additional sale. Combining variables leads to a cleaner model.

  25. Purdue

  26. Opportunity Breakdown Key Takeaway: TVS Star City and Sport are Economically Inferior goods that decrease in sales in wealthier areas. There are some areas where there is opportunity for more sales.

  27. Opportunity Breakdown Delhi Key Takeaway: 73.2% of the sales in TVS City can be explained by its linear relationship with total market segment sales during that month. For every 9 products the market increases, 1 TVS City sale is expected.

  28. Opportunity Breakdown Key Takeaway: Uttar Pradesh, West Bengal and Andhra Pradesh all have very high potential for future sales.

  29. India Promotion Regression Diwali

  30. India Advertising Regression

  31. Agenda • Industry Analysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  32. Our Trip to Indore!

  33. Indore Consumer Feedback Key Takeaway: Customer perceived mileage is key.

  34. Sub-Dealer

  35. TVS Primary Dealership

  36. Misaligned Priorities? Key Takeaway: Customer perceived mileage is key although dealers focus on other selling points.

  37. Summarizing Our Findings • Sales based on perception • Wedding season increases sales • Sub-dealer closer to customer • Customer needs misunderstood

  38. Agenda • Industry Analysis • Traffic vs Retail Sales • Head Effectiveness • Problem Indore • Recommendation

  39. Recommendations

  40. Recommendations

  41. TVS StaR Targets SEC-BCD

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