CEO Tyler Emery wrote an upper division Entrepreneurial Marketing Final Exam Prompt for Loyola Marymount’s Top 7 Ranked Program
Final Exam: Prompt and Answer Key
ANSWER GUIDELINES ARE IN GREEN
- With respect to segmentation, targeting, and positioning how should a startup Italian restaurant located in Beverly Hills (high disposable income area) go about identifying their target market and more importantly strategically reaching them? What information would be needed to determine the relevant psychographics, demographics, behavioral traits, and geographics of the target market for segmentation purposes?
- There is a whole ecosystem of successful italian restaurants within a 3 mile radius of the startup Italian restaurant
- Their competitors are targeting 18-55 year old males and 18-45 year old women.
- You serve very similar dishes to competitors and have won blind tasting competitions.
- Entrepreneurs must realize consumers are different and behave in different ways (demographics and psychographics). The student must distinguish between the two and the implications of assessing demo/psychographics.
- Must understand that specific segments have similar needs, across segments different needs need to be addressed, they are measurable, economically viable, and there is a viable way of reaching the segment.
- Student must address the importance of understanding the cost of reaching certain segments as well as the ROI potential (Fundamental term, Customer Lifetime Value Vs. Customer Acquisition Cost)
- Addresses the importance of geographics, and sees the value in analyzing surrounding competitors to understand their target market and strategies.
- Addresses behavioral: viewing competitor’s customer’s behavior.
- In terms of targeting they must address the expected growth of the market, the cost per acquisition or reaching, the overall competitive position, and the size of this market.
You are a consultant who is trying to convince a high end skin care company in Beverly Hills to manage their social media and build brand equity for them while increasing sales. The owner of the skin care company seems to only care about sales and thinks that engagement from customers on social media is meaningless. How would you convince this potential client that building engagement on social media or on blogs is valuable with respect to customer relationship management?
Student Guidelines for Answer:
- Student must address the importance of building brand equity and the implications of brand value and recognition
- Student must address the importance of building relationships with customers and engaging with them on social media or other forms of media or press.
- What variables should one consider when creating and delivering surveys for primary data research? Is better to implement scales for variation or have yes or no as options? Does it matter who you survey? Does the amount of time it takes to respond to the survey correlate to a high or low response rate?
What variables should one consider when creating and delivering surveys for primary data research? Is better to implement scales for variation or have yes or no as options? Does it matter who you survey? Does the amount of time it takes to respond to the survey correlate to a high or low response rate?
Student Guidelines for Answer:
- Student must address the importance of avoiding biased questions by not including loaded words that influence a certain response.
- Scales allow for variation in responses which means more accurate results compared to yes or no questions.
- Student must address the importance of targeting the right people to take surveys.
- Student must address the importance of being easy to be understood by being straightforward.
- Student must address the fact that high response rate correlates to limited questions and respecting respondent’s time.
You have thought of an idea for a premium laundry machine. It is a washer and dryer that has been integrated into a machine that washes and then dries clothes automatically. You can customize the settings of both the washer and dryer and customer interviews and ethnographies have validated the demand for this product, and that consumers are willing to pay a premium price. Furthermore the target market is well-defined and feasible to reach, and this market has high growth potential. How would you go about evaluating this market opportunity (key elements) and receive funding for it assuming you are working with constrained resources, namely capital.
- You would be able to patent this without any issues.
- This product offers significant profit potential, enough to attract investors
- A similar resegmented product, Coolest, received sufficient funding on a crowdfunding campaign because it is the improved version of a cooler. The parallel here is that this machine is the improved version of a washing machine and dryer.
- An analyst on your team has determined that if you advertised with QVC on the television then the ROI potential would be significant, and easy to reach customers.
A thorough response would address the following points in a relevant way with respect to the example given:
A.) Addresses the importance of creating significant value for consumers by solving a significant problem or by meeting or surpassing an unmet need for something that the consumer is willing and able to pay for at a premium price. In this case acknowledging that there is demand, and that consumers are willing to pay a premium price should validate a hypothesis that consumers would demand this product, thereby reducing risk.
B.) Addresses a strategy to receive funding by a crowdfunding campaign, angel investors, venture capitalists, or other type of funding that is feasible to attain.
C.) Addresses the following in a relevant way:
Customer Value (What Value will this Create for Consumers)
Customer Satisfaction: Current Alternatives (view of washer and dryer)
Ability to Command a Premium Price (As alluded to in question)
Sustainable Competitive Advantage (patent, product’s superiority).
Access to Customers
Customer-Felt Need: Strong because there is demand for this substitute product
Market Growth Rate
You own a PR agency and one of your new clients is a fine jewelry retailer that relies on online sales, and deals primarily in engagement rings. They have requested you to get in touch with the press in order for them to earn media coverage. Their products are premium priced, and you have the following online magazines requesting coverage, but you can only choose one:
*** All magazines have roughly the same subscriber list and daily views ***
A.) Fantasy Wedding Magazine – covers desirable weddings that are luxurious and expensive. The subscriber list is primarily affluent individuals with a household average income of $100,000 a year.
B.) Beauty in Nature Magazine – covers nature including rocks, the ocean, plants, and animals
C.) Affordable Luxury Magazine – covers luxury accessories that are made with fake gemstones
D.) Celebrity News – covers celebrity gossip, the average disposable household income is $49,000 a year.
Which magazine would you choose given the client and why?
Student should choose fantasy wedding magazine because it is relevant in terms of psychographics and demographics for segmentation purposes and pricing strategy. Since their best sellers are engagement rings this form of press is most likely to reach the right targeting, segmented individuals and position the product to them in a way that uses pull/inbound marketing.