CAN THE DEERS BE THE KING OF THE JUNGLE ?

There was a Jungle with lots of animal staying inside and many migrating from different other places in search of food and becoming a part of the jungle. Since many years the jungle was declared as a democratic place and mainly ruled by the two families of Lions and Tigers based on the support from the other animals. The wolves were the main followers of these two families and depend on the sides they choose to be, the respective families gets the crown of the jungle. Since last ten years it was the lions ruling the jungle.

Over the years the ruling families got out of touch with the other animals of the jungle and relied on the wolves in running the day to day administrations. The wolves started behaving as lions/tigers of the jungle and started taking advantage of the power endowed on them in harassing the poor animals. Slowly the jungles started getting difficult for the animals to live. There were taxes imposes on them on many basic needs like food water etc. Sensing the uncertainty and instability of the situation, many animals started complaining against the same but the message was not getting reached to the king. The system has got so corrupted that the animals started living with their faith in the hands of the wolves.

It was the time the tenure of the lions was about to get over and again the election has to take place. While the lions started making the wolves happy and supporting those in all their activities, the tigers waiting for the crown since many years, took the opportunity to reach to other animals and asking for their support.

Bambi, the leader of the Deer families, who was fighting with the system since a long time, had realized that, there is no difference between the lions and the tigers. He called a meeting of all animals and started telling everyone that at the end of the day, the wolves are going to run the shows and hence he suggested for a tough bargaining with the lions for a sustainable system for a better life of all the animals of the jungle. Or else we change the ruler.  

“But to whom to trust? To whom to vote for? Why don’t you contest the election” the rabbit suggested and all other animals supported.

“Election? No… how can we fight against the lions and tigers” A member of the Deer family screamed. “It is not a simple game to play. Can we survive in this jungle if we dare to do so?”

“Anyway we are struggling to survive now. We should fight and take a chance to change the system” Bambi told to all.

Getting this news about the new happenings in jungle the lions and tigers started laughing and also invited the Deers to contest the election.

On the day of the election, it was an unbelievable scenario since there was fifty percent increase is number of voters. Those who never came for any voting turned up this time to suppot the Deers in a hope for change in system. As a result the Deers got the second position to tigers in the election and the lions were almost out of scene. It was chance for the tigers to rule the jungle but realizing that many of the animals of the jungle are supporting the Deers, it will be difficult to rule the jungle as done in past. Similarly the lions also got surprised with the result and were very uncomfortable in this scenario and they were feeling insecure the coming years. The wolves were hiding behind and waiting for a direction from lions/tigers while all other animals in the jungle were celebrating the victory of the Deers.

Behind the scene the lions met the tigers in a undercover meeting and expressed their feelings. The tigers too agree with the lions since the future for both of them seems to be a difficult to survive. They framed an undisclosed strategy to deal with the situation.

In a meeting of all the animals the tigers expressed their unwillingness to rule and ask the Deers to rule for their good cause. The lions supported the Deers and asked them to rule and change the system. It was a tough time for the Deers since the Deers are one of the simple families of the jungle and ruling the jungle needs more of muscle power than emotions. The existing corrupt systems also run by mainly the wolves, who are the supporter of lions/tigers and partner to them. Bambi already realized the difference between winning and ruling the jungle. Infront of all animals he put some conditions for the tigers and lions before taking the crown. The tigers rejected all stating, the ruller has to take its own decision and the lions expressed their eagerness to the conditions but simultaneously stated that incase they found the Deers are not able to rule they will withdraw support.  It was a very difficult position for the Deers also all other animals wanted everything should get settled soon before anyone outside take advantage of this in the jungle.

If Bambi take back his position, he will lose the trust of all the animals and his dreams of changing the system will never gets fulfill and also it will be difficult for the Deers to survive in the jungle after that.

What should Bambi do now? Even if he takes the position of ruler, will he be able to change the system? Can the Deers ever be able to rule the jungle? If yes then till how many days?

                                                                                                                  

CASE ANALYSIS : TARGET THE RIGHT MARKET : SPARKPLACE

EXECUTIVE SUMMARY :

This report explores case study of SparkPlace, an online-marketing software company. Due to the limited resources available to this company, it wants to target two available markets: small businesses with no more than 20 employees (Small Sams) and medium-size businesses with 20 to 100 employees (Medium Marrys). The case illustrates that SparkPlace is in a crossroad to and the major challenge faced by the sales and marketing executives at Sparkplace is the dilemma in selecting the suitable market segment within these two segments. The report will review the SparkPlace’s Potential, marketing challenges and possible solutions.                                                            

                                                                    CASE ANAYSIS

SWOT ANALYSIS OF SPARKPLACE:

STRENGTH

·       Spark Place’s user friendly software

·       Success in acquiring Sams

·       New venture in to content development will increase SparkPlace market presence

·       software development capability to create products which can target both Sams and Marys

WEAKNESSES

·       Concentration on Permission based Marketing.

·       limited experience in the industry (Approx. 2years) can be the reason for fewer acceptances among Marrys

·       Funded by VCs and has resources constraints

OPPORTUNITY

·       Growing market potential(Sams & Marrys)

·       Beyond permission based marketing. e.g Send the content that subscribers want. Upon sign-up, allow subscribers to choose whether they want deals, business updates or tips about products

·       VCs need return on their investment and of course, if they get it, they represent a new source of funding

THREAT

·       Competition is tough for Marrys and also Sams are more volatile

·       There is always a pressure on Margin since Sams are very prone towards low cost products.

·       Sparkplace software available on Monthly fees, can be a probable reason for customer churner. Since many Sams may found this as an immediate pressure on balance sheet.

MARKET ROI ANALYSIS (SAMS VS MARRYS)

Examining SparkPlace’s data, it can be seen that each $100K of combined Marketing and Sales expenditure can brings in 33 Numbers of small Sams & 3 numbers of medium Marrys.

On an average life time, the 33 Sams will generate Profit of $330K ( $10K* 33Nos). The average contribution to profit after marketing & sales cost $231K ($7 K* 33Nos).

Similarly on an average life time, 3 Marrys will generate profit of $150K ( $50*3 Nos). The average Actual contribution to profit after marketing & sales cost $60K ($20 K* 3 Nos).

Based on the profit contribution, total Market potential for Sams: $9.1bn( $7K*1.3M)

Based on the profit contribution, total Market potential for Sams: $10bn( $20K*0.5M)

Even if the average customer churning rate of Sams are 3 months and that of Marrys are of longer duration, on an average Sams seems to be of more profitable for an equal amount spend on marketing and sales. But looking in to the total market potential based on profit contribution, it is almost same in both the cases.

Considering the average marketing and sales cost per customer, to acquire 1.3 million Sams, SparkPlace needs to invest a total of $3.9 bn in marketing & sales. To acquire 0.5 million Marrys SparkPlace needs to invest a total of $15 bn in marketing & sales.

THE BUSINESS SOLUTION: Focus on Sams but not to ignore Marrys

Sams are the cash cow for the company since the market penetration is very good. Initially SparkPlace should continue to mainly focus on Sams and simultaneously understand the needs of Marrys and continue to invest in Marys too. Sams will no longer remain Sams but would graduate to Marys, so even if there are 20% graduation rate, SparkPlace will be better off sticking with Sams and growing the business to eventually cater to Marrys.

The flip side of not targeting both the market is that, SparkPlace runs the risk of creating self-inflicted boundaries for themselves, which could act adversely if market dynamics were to change radically in the future.

Sales and marketing Strategy:

• Profile Sams into different groups based on profits, turnover and lifecycle.

Ø  Potential Marrys: These Sams would have more chances of converting to Marys. SparkPlace should target this segment by providing trainings/demos for the software, preparing sales pitch for selling its features and services, consultative or value selling, providing free trial/discount during adoption phase.

Ø  The churners: SparkPlace should understand the reasons for the churn and how to retain them. Feedback should be taken and share with sales, marketing and development team.

• Increase the contract length  to  Six months or One year and provide Sams the product on Quarterly rent basis. It will not put immediate pressure on Sams balance sheet and will eventually help Sams to concentrate on other areas of business for growth and profitability.

• Keep the detailed product demos and customer support to show how the product adds value to Sams/ Marrys. The users should be well trained to use the product and know why it adds value to their business.

• Prepare and train the sales and marketing team for selling content development software along with e-marketing software. This will help in building a long-term relation with customer.

• While selling and making a profit on the Sams, reinvest the profits into making contacts with Marrys.

Product development Strategy:

• Supporting sales and marketing strategy, standardized the software for Sams and Marys so that sales team could be given training for the overall product which could be easily customized depending on the needs of the customer. The sales team then could decide the value proposition of the product when they prepare the sales pitch.
• Create a niche product that does something really well for a specific size of business or for a specific industry
• Focus on creating an 'all in the box' software product that is well known, easy to use and does a lot more than competitors.

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