Poppy West - N0731532 Strategic and Creative Solutions: FMBR30001 2019/2020 Stage Two Report 8,500 words
ethics clause I confirm that this work has gained ethical approval and that I have faithfully observed the terms of the approval in the conduct of this project.
Poppy West
Signed (student) ……………………...............................................
10/05/2020
Date..............................................................................................
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Whether you like it or not... Let’s get talking!
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CHAPTER ONE - INTRODUCTION Introduction.......................................................................................................8 Rationale...........................................................................................................8 Report Aims and Objectives.............................................................................9
CHAPTER two - methodology Methodology Aims and Objectives...................................................................12 Research Philosophy.........................................................................................13 Sample...............................................................................................................13 Research Design...............................................................................................13 Data Collection Methods..................................................................................14-15 Intended Research............................................................................................16 Advantages and Limitations..............................................................................18-19
CHAPTER three - the opportunity Future Thinking and Stage One Reflection........................................................22 The Opportunity/Problem...................................................................................22 Idea Generation Journey....................................................................................24-25 Concept Testing The Game...............................................................................26-27
CHAPTER four - the big idea Business Aims and Objectives..........................................................................30 Business Summary............................................................................................31 Brand DNA.........................................................................................................31-35 Branding Guidelines..........................................................................................36-37
CHAPTER five - structure and marketing mix Business Model and Revenue Stream..............................................................40 Organisation, Manufacturing and Distribution..................................................41 Marketing Mix....................................................................................................42-45
CHAPTER six - the consumer Buying Behaviour...............................................................................................48 Consumer Segmentation...................................................................................48-49 Pen Portraits and Consumer Split....................................................................50-53
CHAPTER seven - the market Market Overview................................................................................................56-57 Market Drivers and Trends................................................................................58-61 PESTLE..............................................................................................................62-63 Market Competitiveness and Structure............................................................64-65 Competitor Analysis and Market Positioning...................................................66-67 Porters Five Forces...........................................................................................68-69 Market Readiness..............................................................................................71
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CHAPTER eight - strategic direction
CONTENts
Where is the brand now?...................................................................................74 SWOT Analysis...................................................................................................74 Ansoff Matrix Model...........................................................................................74 Where does the brand want to go?...................................................................75
CHAPTER nine - marketing strategy Marketing Aim and Objectives...........................................................................80 Year One.............................................................................................................81 Year Two.............................................................................................................82 Year Three..........................................................................................................83
CHAPTER TEN - COMMUNICATION PLAN Communication Aim and Objectives................................................................86 AIDA and DRIP Models.....................................................................................87-88 Offline Channels...............................................................................................90-93 Online Channels................................................................................................94-103 Launch Campaign.............................................................................................104-107 Tactical Timeline for Year One..........................................................................108 Year Two and Three Communication Overview................................................109
CHAPTER eleven - Financial Overview Raising Capital and Start Up Costs..................................................................112-113 Sales Forecast...................................................................................................114-115 Profit and Loss Account....................................................................................116 Marketing Budget..............................................................................................117 Sensitivity Analysis............................................................................................118-119 Cash Flow Forecast...........................................................................................120-121
CHAPTER Twelve - logistics Business Implementation Timeline....................................................................124-125 Key Roles and Responsibilities.........................................................................126 Measuring Success............................................................................................127 Risk Assessment................................................................................................128-129
CHAPTER thirteen - the future and conclusion Future Growth....................................................................................................132 Ansoff Matrix Model..........................................................................................132 Conclusion.........................................................................................................133
Appendecies For Appendix, References, Bibliography and Image References see the separate document.
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CHAPTER ONE
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INTRODUCTION
introduction Prior to the development of this business plan, extensive research was completed in both the Stage 1 and Future Thinking reports. The Future Thinking study researched the macro trend “Dislocated World” in great detail, helping to formulate the backbone for further investigation. From there, Stage One gained thorough understanding of youth activism among Generation Z, providing critical insight into its impact on modern society. This report aims to effectively propose a new business concept based on the insights and recommendations created during Stage One.
RATIONALE “Feel like young people are definitely getting supported lots by other young people, I’m not sure if that same support is coming as strongly from older generations though…I know if I’ve got an opinion and I talk to people my age I feel like they’re a bit more open to listening and just hearing me out - but with older people (like family members) you can say your point and they will barely listen to what you’re actually saying” - Interview respondent from Stage 1 (West, 2020). As concluded in Stage One there is a lack of communication among the generations, in particular on potentially sensitive subjects such as politics, environmental issues and religion, leading Generation Z feeling unsupported by the key adult figures in their lives (West, 2020, p. 68). As a result, it was concluded that there was a business opportunity for an event or product that promoted communication among family and friends. Subsequently, a report has been formed that reflects knowledge gained throughout initial research and will illustrate a feasible and commercially scalable business opportunity that meets the consumer need for better communication.
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aim and ob
jectives
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CHAPTER TWO
METHODOLOGY
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methodology s e v i t c e j b o d n a aim
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RESEARCH PHILOSOPHY A pragmatic research philosophy was chosen for this research, allowing integration of multiple research methods, including quantitative and qualitative methods (Research Methods, 2019). Using this research philosophy, the methods undertaken ensure the overall research is effective, gaining insight from many sources that will provide scope to the business plan.
SAMPLE Self-selection, non-probability sampling was used to choose the sample, meaning: “the sample is based on the researcher’s judgement regarding the characteristics that are important in relation to the data required� (Saunders, 2012). This ensures control is with the researcher and research can be specified using particular knowledge from the participant. The sample will alter depending on the research method as the aim of each method changes. The key sample for the consumer research (survey and focus groups) is wide with the age range being 18-56+, this is due to the business aiming to market to all ages and genders.
RESEARCH DESIGN Both primary and secondary methods were used, ensuring the study is comprehensive, fulfilling the research aim and objectives. A mixed method approach was taken to gain both qualitative and quantitative data, drawing on strengths of all research methods (Shorten & Smith, 2017). By using this research approach, the study can effectively utilise many resources that will lead to a better understanding of the business opportunity.
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survey - online survey with 100 participants To gain insight into the general consumer perception and spending habits of board/card games as well as concept testing the game idea to the consumers, in order to validate its potential.
concept testing focus group - 4 participants To gain validation of the game concept from the target consumer group and whether they would purchase the game.
idea generation interviews - 2 semi-structured interviews To concept test the two initial ideas as the idea generation stage of the business creation. This research aims to help confirm the final idea to move forward with.
INDUSTRY interview - gRAEME FRASER-BELL EMAIL INTERVIEW, OWNER OF ACCENTUATE To gain knowledge on the logistics of starting a games company with a single game and to understand the key successes and pitfalls Fraser-Bell found in the creation of his own business.
INDUSTRY interview - james vaughan EMAIL INTERVIEW, head of inventor relations at big potato games company To AB concept test the two varying game structures and understand which is most consumer friendly to move forward with.
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data collection methods INDUSTRY interview - hAZEL reynolds linkedin INTERVIEW, OWNER OF gamely games and randomise game To gain knowledge on the logistics of starting a games company and to understand the key successes and pitfalls Reynolds found in the creation of her own business. To understand how Kickstarter could benefit the new game in its formation.
INDUSTRY interview - DICE CUP CAFE FACE-TO-FACE INTERVIEW To concept test the initial game idea from the perception of an avid gamer and to understand the games cafĂŠ market opportunity for the game.
BRANDING CONCEPT TESTING - INSTAGRAM POLL TESTING WITH 102 PARTICIPANTS To AB concept test the two branding logo options and understand which is most popular with consumers to move forward with.
SECONDARY RESEARCH - BOOKS, ONLINE ARTICLES, TREND REPORTS, VISUAL RESEARCH, PODCASTS.... To gain a wider understanding of the market environment and external factors which may have an impact on the business environment of the business. To fully understand not only the market but the ways other brands operate within the market and communicate to their consumers, in order to inform the creation of the marketing strategy and communication plan for the game.
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Intended Research At the time of completion, there was a strong external factor that severely influenced the research outcomes. The implications of the Covid-19 pandemic meant that certain data collection methods previously intended were no longer viable and substitutes were required. The focus group conducted was intended to be completed in person as this would allow for data on the respondents behaviour, which is a strong indicator of what people think or feel (Nardi, 2018). However, as a result of the UK lockdown this could not be done. As a result, Microsoft Teams was used instead as it allowed all participants to react to each other and see each other’s behaviour. This meant there were few impacts altering the way the focus groups were conducted. There was little impact to the industry interviews as these were initially intended to be completed over the phone, email or LinkedIn to ensure ease for the participant. However, the time it took to gain the interviews was significantly lengthened in some cases, with one participant who first agreed to participate not responding to follow up contact (the transcripts of this conversation have been included in appendix 9). This participant was chosen to provide insight into wholesale of a product and the process of selling through external retailers such as Amazon and bricks-andmortar stores. This meant this information had to be found elsewhere through secondary sources.
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advantages & limitations Research Method
Sample
Rationale
Advantages
Disadvantages
Survey
A selected sample of 100 respondents aged 18+, varying genders and demographics
The aim of this survey was to test the business concept amongst target consumers, and assess the consumer’s current relationship with games.
A way of gaining quantitative data easily. Questionnaires are a good research method for assessing, in a measured way, what respondents report to believe.
The limited time constraints meant that the proportion of respondents was potentially not fully representative. This research method does not gain data on respondents behaviour, which would normally be a good indicator of how people actually feel about a subject, this is where other forms of primary research can support the gaps in attaining behavioural responses.
Interviews (face to face)
2 interviews with one 52-year-old male and one 50-year-old female.
The aim of these two short interviews was to concept test the initial two business ideas formed at the idea generation stage. These interviews where aiming to clarify the idea that was taken further.
Interviews aid the attainment of qualitative data as they can gain human level responses. Pre-established questions can be used in order to make the interviews structured in format, which is the best format for inexperienced interviewers (O’Leary, 2017).
Potentially there could be an interviewer bias where the interviewer’s body language/facial expressions could sway the respondents answer.
Industry Interviews: James Vaughan
One respondent (Head of Inventor Relations at Big Potato Games)
An email interview was conducted to AB concept test the two varying game structures and understand which is most consumer friendly to move forward with.
The simple use of AB testing allowed for more concrete, definitive answers on the better choice for the game structure.
Due to the simplistic AB testing method there was little room for issues, however there was a risk that Vaughan would not respond to the communication.
Concept Testing Focus Group
Selected sample of four participants, varied ages and genders.
The aim of this focus group was to gain validation of the game concept from the target consumer group and whether they would purchase the game.
The focus group allowed for rich qualitative data to test the concept and its consumer appeal. Good way to support the concept testing gained in the survey.
The focus group was conducted with close family and friends, potentially leading to biased responses.
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Industry Interviews: Grahame Fraser-Bell
One respondent (Owner and creator of Accentuate_
An email interview was conducted to learn more about the logistics of starting a games company with a single game and to understand the key successes and pitfalls Fraser-Bell found in the creation of his own business.
Using the email interview format allows the enlargement of research potential through digital interaction. Using email to conduct the interviews works as an advantage as industry specialists have busy time schedules.
There is a potential lack of spontaneity, which could lead to “fake responses” as the respondents had time to read and assess the questions before answering (Burns, 2010).
Industry Interviews: Hazel Reynolds
One respondent (Owner of Gamely Games and creator of Randomise)
A LinkedIn interview was conducted to gain knowledge on the logistics of starting a games company and to understand the key successes and pitfalls Reynolds found in the creation of her own business. To understand how Kickstarter could benefit the new game in its formation.
Utilising digital interaction methods to organise and communicate with the industry experts is convenient and fast.
One limitation of this form of research is the reliance in potential participants agreeing to take part. As there is a short time frame to the report, there was the potential that once contact was made the experts would not send the responses back in time.
Industry Interviews: Dice Cup Café
One respondent (Owner of Dice Cup Café, Steve Raine)
An in-depth one-toone interview was conducted with Steve Raine, owner of a Nottingham based games café. The aim of this interview was to gain insight into the games café market and concept test the game with a gaming expert.
Face-to-face format allows for synchronous communication through social cues such as voice, intonation and body language (Opdenakker, 2006)
One-to-one interviews are difficult to organise in the short time frame as it requires both interviewer and interviewee to be in the same place at the same time; this method requires good time management and planning skills.
Instagram Poll
Selected sample of 102 respondents aged 18-30.
An Instagram poll was conducted as a means of assessing consumer appeal to varying branding concepts to see which would be most successful to take to market.
Fast and easy way to collect quantitative data to decide the branding outcome. This allowed the researcher to gain the data in one day rather than wait weeks for respondents of a survey. The immediacy of the data collection allowed progress to the brand development to be made quickly.
As the responses were being gained from the researchers personal Instagram account there was the risk of responses being biased and unrepresentative, however as the branding concepts where posed to the participants with no differences between them there was little room for bias to take place.
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CHAPTER Three
the business opportunity
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Future thinking & stage one reflection Future thinking identified that youth activism was growing among Generation Z and that discussing issues such as politics and environmental struggles were becoming more significant to this demographic despite their younger age. This then led to the Stage One research project on Generation Z becoming activists and the impact this is having. Through the extensive research undertaken within Stage One, the following insights where formed (West, 2020, p. 68): • There is a need for intergenerational relationships to be improved through communication on sensitive topics such as politics and that both young and old generations are not wanting to have these conversations organically for fear of upsetting each other. • • There is a consumer desire for brands to become educational on issues they care about and help them understand how they can help with activism activities. • • As a result of the negative mental health impacts of activism, there is room for support initiatives to be set out to help young people in their efforts to make a difference and understanding issues surrounding them in a safe space.
the opportunity “Family discussions about sensitive topics are important. In an age increasingly marked by incivility, we need places where we can learn (or relearn) the practice of civil disagreement—that is, the art of disputing others’ ideas in ways that respect those persons’ intrinsic worth. Family life affords such a place. It is uniquely suited to serve as a training ground where its members can cultivate the virtue of civility” (Love, 2017) Stage One highlighted the need for conversations about sensitive topics and that all generations struggle to communicate with each other organically out of fear of upsetting the other. This lack of communication is resulting in people not feeling supported in their opinions, which is potentially leading to issues in their mental health. This insight reveals a significant gap within the market. It is clear that people need a brand to provide them with the safe opportunity to communicate their opinions and listen to others.
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idea generation journey Initially two business ideas were created that both aimed to get people talking about taboo topics (see the tables for full concept aspects). These ideas were then discussed with potential consumers in order for a decision to be made on which business was the more commercially viable (see appendix 3 and 4 for full interview transcripts).
idea one Outline of the Idea
A card game that gets families and friends discussing taboo subjects in a light-hearted, fun way.
Purpose
To open up the conversations around difficult topics so everyone’s opinion can be listened to and heard by the people they care about.
Inspiration
The card based format has taken inspiration from games such as Cards Against Humanity and What Do You Meme.
Need it would meet It provides the fun, non-judgemental platform to house the conversations around difficult topics. Cons of the idea
Within primary research, one aspect that was raised is that some consumers may not want to play a game that they feel would spark arguments with families.
Pros of the idea
Easily accessible for consumers as it is a single product.
The key insight that emerged from the interviews was that the game was the preferred concept as both liked the idea of the game being able to be played at home rather than a public experience: “I like that the game idea bought the same topics into the home, I would definitely feel more comfortable discussing topics like this in my own home” (Idea Generation Interview 1, 2020, see appendix 3). “My favourite is definitely the game. I didn’t like the restaurant idea as I feel it would be awkward at a meal, when I go out to eat and am paying money I want to know I am going to have a good time…I don’t want to spend my whole time arguing with my family over the table in public” (Idea Generation Interview 2, 2020, see appendix 4). The interviewees made positive comments about the game concept, both stating they would purchase and play the game with their families and friends. This has resulted in this concept being chosen as base for the final business idea.
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idea two Outline of the Idea
Restaurant that provides the taboo topic questions on the plates, inviting diners to talk about their opinions around the table.
Purpose
To spark the conversations in a safe space while offering a unique dining experience.
Inspiration
The question on the plate concept was inspired by the TV show ‘Eating With My Ex’ (BBC, 2020) where two ex’s have questions they have to answer presented to them on plates.
Need it would meet Provides an open space, that is accepting of all views and opinions. It provides a space for diners to state their opinions and views on topics. Cons of the idea
The feasibility of a new restaurant is risky. The restaurant having limited scope due to geographical location of consumers means it is not easily accessible by many consumers.
Pros of the idea
Provides a unique and memorable dining experience.
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game concept testing Once the game idea was finalised in the previous testing, 100 survey respondents gave their feedback and described their current relationships with games (see appendix 1). Additional feedback for the concept was gained from a small focus group (see appendix 2). Both the focus group and survey both confirmed the popularity of the concept with just 17% of survey respondents saying they do not like the game, and all focus group respondents liking the idea.
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don’t like the concept 17%
like the concept 83%
“I really like that idea, my family love playing games like that and now the kids are older we can play games that have some risky topics which this one has!” (Focus Group Attendee 1, 2020, see appendix 2).
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CHAPTER four
the big idea
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ss e n i bus tives c e j b o
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BUSINESS SUMMARY Agree to Disagree is a UK based card game that gets families and friends to discuss and listen to others opinion’s on ‘taboo’ topics such as politics, religion and the environment. Aimed at young Millennial consumers and their families/friends, who want to voice their opinion and learn others. The game aims to open up the opportunity for light-hearted conversations and make potentially difficult discussions fun, breaking stigmas and strengthening relationship bonds.
brand dna USP The game offers a meaningful experience to improve current relationships in a fun, lighthearted way.
MISSION Agree to Disagree aims to provide the opportunity to break stigmas and make taboo conversations fun and engaging, by offering a platform for families and friends to better their understanding of each other’s views.
VISION “Our vision is to become the helping hand to enhance relationships by providing a meaningful consumer experience, both in the game and outside”
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brand values communication We believe that communication should be at the core of every relationship in your life. We want you to have a safe space to voice your opinions to the people you care about.
honesty We want you to be completely honest with each other when playing our game, so you should expect nothing less than complete honesty from us. We hold transparency and communication between us and you at the core of everything we do!
community We believe in building a community of trust between us all and want to create a safe space for anyone to voice their opinion.
the golden circle By using the Golden Circle Model (Sinek, 2009), the core purpose of the brand can be clearly identified, ensuring this purpose remains at the heart of all the brand communication.
why?
how?
what?
To make difficult conversation fun in order to break stigmas and create closer bonds.
Opens up the opportunity for light-hearted conversation among family and friends.
A game that gets people to discuss and listen to other opinions on ‘touchy’ subjects.
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benefit ladder The benefit ladder is an effective tool to understand how the brand benefits the consumer and makes them feel. It is crucial that this is understood as the brand needs to put the consumer first, always thinking about how the actions will impact the consumer in a functional and emotional way.
emotional benefit • Consumers feel better connected to their family and friends. • They feel empowered and supported that their opinion matters, even among a large group of opinionated people. • They feel they are better understood by their family and friends and understand them better too. • Consumers feel they are learning new things about themselves and the world around them.
functional benefit • A fun game to play that offers a meaningful experience. • Provides a helping hand to get the difficult conversations started – so the consumer doesn’t have to. • Helps the consumer’s families and friends bond and learn more about each other. • Provides the change to create memorable experiences with friends/ family. • Durable product that will last.
product benefit • Environmentally conscious packaging that denotes the ethical nature of the brand. • Long product lifecycle. • Positive, supportive brand message.
features and attributes • FSC Certified materials so the product is beneficial for the environment. • Hard-wearing and durable product that has the opportunity to have a long lifecycle, • Bright, fun packaging. • Brand is transparent and trustworthy.
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identitiy and essence Using the brand identity prism model (Kapferer, 2012) ensures thorough understanding of the brand’s identity and how it will be viewed by consumers. The model is important as it provides a clear view of key attributes of Agree to Disagree. As outlined in the brand identity prism, Agree to Disagree’s core identity is that of an honest, playful and passionate brand that aims to make difficult conversations fun in order to break stigmas and create closer bonds in consumer’s lives.
Capabilities
Personality
Quality product that offers consumers a meaningful experience both in game and outside. Great customer service.
Honest Fun and playful Approachable Passionate and empathetic Supportive Informative
Internal Culture Drive communication and connection. Want to create fun and play. Passionate about honesty and having a voice. Driven by the growth and learning of consumers. Passionate about giving consumers a meaningful experience.
rallying cry To make difficult conversation fun in order to break stigmas and create closer bonds.
Noble Purpose
Shared Values and Community Using the game to create a meaningful experience that impacts consumers lives. Forming a connection Better communication and bonding.
Aspirational Self-Image
Wants to change the way people communicate with each other about typically taboo subjects. Wants to provide the opportunity for personal and relationship growth and learning.
Risk-takers Caring Honest Conscious Approachable Empowered
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TO
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O I C V E F O E
It is important that the brand’s voice is consistent across all consumer touchpoints in order to effectively communicate the key message and values of the brand. Agree to Disagree’s tone of voice is fun and playful, while remaining honest and trustworthy and fun.
Honest Fun and playful Approachable Passionate Empathetic Supportive Informative Risk-Taker
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logo
The logo is inspired by the different opinions players can have. The use of the two opposite arrows represent this in a clear and appealing way. The secondary logo is to be used across social media as the shape is more appropriate for socials, while keeping the brands visual identity intact. The logo was finalised as a result of the primary research whereby this logo was favourite for 60% of respondents (see appendix 10).
slogan Whether you like it or not... let’s get talking!
colour scheme The colours chosen have no gender or age affinity or bias. They are bright/punchy so work well within the games industry, helping the brand to stand out against competition.
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font primary font: BEBAS NEUE (bold) abcdefghijklmnopqrstuvwxyz 1234567890 ?!&@£ Secondary Font: Helvetica Neue (Regular) abcdefghijklmnopqrstuvwxyz ABCDEFGHIJKLMNOPQRSTUPWXYZ 1234567890 ?!&@£
Both fonts chose and c n are le a n, m clear aking fo r v arious them ide By h brand av i n g ing u al ses. t wo that w clear ork w f o e nts l h av i n g c l e a l to g e t h e r while r role brand s with visua in the l iden the b t it y is rand k visua appea l s c a n ey a s ling a r emain nd ac reade cessi r s. ble fo r
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CHAPTER five
business structure and marketing mix 39
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BUSINESS MODEL AND REVENUE STREAM Agree to Disagree will operate using both a direct-to-consumer (D2C) business model and a wholesale business model; it will have three revenue streams as the game will be sold directly through the brand’s own website and through other retailers (both online and offline) such as Amazon, John Lewis and Smyths. By offering the consumer multichannel distribution options they will have more options for purchase and be more inclined to buy.
The company will register as a Private Limited Company which will ensure the shareholders are not personally liable for any financial losses (Gov UK, 2020). In order to fully understand all the key elements of the business model a Business Model Canvas has been completed (see appendix 11).
ORGANISATION, MANUFACTURING AND DISTRIBUTION PROCESS As a small start-up looking to create limited numbers of product, manufacturing could become expensive when completed in the UK. However, as a UK based company, a local manufacturer was chosen as the authenticity of the brand and product quality would be assured doing this. Amidst the uncertainty of external influences (see PETSLE in Chapter 6) a UK manufacturer was chosen, despite the higher cost, as a way of lessening the risks of the manufacturing process.
Reynolds who currently uses the company (see appendix 7). While Tamazi will deal with the B2C and the B2B of retailers, they will not fulfil the orders through Amazon. For Amazon sales, the products will be delivered straight from the manufacturer to the Amazon warehouse whereby the units will be distributed to consumers using the Fulfilment by Amazon (FBA) process (Amazon, 2020). FBA is Amazon’s solution allowing sellers to utilise customer benefits such as Prime delivery and European distribution. Using FBA means Agree to Disagree does not have to handle the storage, delivery, customer service or returns of the products sold through them.
The product will be manufactured by UK manufacturer Ivory Graphics and then shipped to the third-party logistics distribution centre, Tamazi Fulfilment. Once shipped, the stock will then be held and shipped to B2B retailers and consumers when needed. Tamazi will deal with the B2C and B2B distribution at a cost of £2 per unit (Tamazi Fulfilment , 2020). They were chosen on recommendation of Hazel
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ivory graphics (manufacturer) amazon
tamazi Fulfilment centre
external retailers (sainsbury’s, smyths etc)
consumers
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marketing mix A table with an outline of all 8 P’s has been created and included in the appendix (see appendix 13). This offers an overview into the wider, evolved marketing mix whereby 8 components have been cited as crucial for marketeers to understand (Kotler & Armstrong, 2015). A deeper analysis of the 4 key model components has been completed in order to understand these elements of the marketing mix in great detail.
product and packaging The game is a card based game that offers players the opportunity to voice their opinions to each other. The rules are simple and easy to follow as to not confuse players, meaning the game is quick and user freindly.
on the environment. FSC certified paper is made from tree-fibres and is ensures product quality is intact, whereas directly recycled paper/card diminishes the print quality (FSC, 2020).
Aligning with the brand’s commitment to supporting environmental efforts, the product materials will be hard-wearing ensuring longevity and made using FSC certified paper (Ivory Graphics, 2020) to guarantee the product has the lowest impact possible
With the packaging design there are specific elements that are legally necessary to have present (Pixy Games, 2016). These elements (barcode, age of players, number of players, company name and address and where the product is manufactured) have all been added on the packaging mock-up and ensure that Agree to Disagree is legally sound for trading.
COMPANY DETAILS
logo CE MARK
SOCIAL LINKS SLOGAN
fsc mark Age mark & no of players
BARCODE 42
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PRomotion A combination of bought, owned, earned and created media will be used to build initial brand awareness and engagement. The brand will use a plethora of promotional strategies
to gain consumer interest in the product. These methods are expansively discussed in the Marketing Strategy and Communication Plan sections of this report.
PRICE Agree to Disagree will retail at £18, this price has been created using a market-oriented pricing strategy (Peters, 2019). The price has been formed by pricing below the market. Key players and competitors within the market have priced their products at £20-£30 RRP, so by consciously pricing below the competition Agree to Disagree becomes more enticing to the consumer. Price satisfaction was validated through primary research whereby 66% of people would be willing to pay £11-20 for a new game (see appendix 1). This price of £18 is the price that the game will be sold at on its own e-commerce site and what is
expected for the external retailers to sell the product at. As the game will be sold through wholesale to other retailers, one revenue stream will be from the other retailers rather than the consumer. This means the revenue will come from the wholesale price of the product which is £11.88 (see appendix 18 for calculations). The wholesale percentage used to calculate this is 40% as it is the average for the retailer type (Davies, 2020). This figure of £11.88 will be used to formulate part of the revenue in the later finances.
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PLACE Agree to Disagree will distribute both online and offline. The game will be sold directly through the brand’s own website as well as through other retailers (both online and offline). It is important that the game still has a physical presence within bricks-and-mortar stores as well as digital presence, this is because: “85% of consumers prefer to shop in stores, but still want a digital and mobile component” (Skeldon, 2019) The bricks-and-mortar retailers that Agree to Disagree will be sold through were chosen on their size and their reputation. The retailers Agree to Disagree will be stocked in within the first year is John Lewis, Smyths and Sainsbury’s; these retailers ensure the game is placed within the three key forms of in-store retail, supermarket, department store and a toys and games specific store. During the future years of running, more retailers will be gained in order to grow the distribution channels and consumer awareness. An online presence is key for Agree to Disagree with the game being sold both directly through the brand’s own website and through online retailer, Amazon. By getting the game sold through Amazon there is more scope to reach consumers, additionally 58% of consumers stated during primary research that they would most likely purchase games via Amazon (see appendix 1). All the retailers chosen already stock incredibly similar products with games and toys being a large category in each. A retailer assessment has been created to understand the potential of each of the initial retailers, what they will bring to the success of game sales and the scope they have as large retailers (see appendix 14). Through this research it can confidently be said that Agree to Disagree would attain stocking rights in these retailers within the first months of trading, despite being a start-up.
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CHAPTER six
the consumer 47
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BUying behaviour When looking at the consumer it is important to look at their buying behaviour towards the product specific category. Using Google Trends, it became clear that during the colder months, specifically the Christmas period, card and board game searches spike dramatically (see appendix 15 for graphs). This suggests that consumers look to purchase games around this period as gifts or as a popular indoor hobby.
As a result, Agree to Disagree will need to ensure their marketing strategy and communication plan are strong around these months, to push the brand to the consumer at the right time. As the brand will be launching months prior to Christmas, there is a strong lead time for the brand to grow and gain popularity before this time of year.
consumer segmentation The most attractive audience is a combination of the younger generations with a mix of older Generation Z (18-24) and younger Millennials (25-30). This mixture of the demographics is attractive to Agree to Disagree as they are more likely to be open to having difficult conversations about issues (Parker, et al., 2019). As a result, the product will potentially be more appealing initially to this consumer group. This consumer group is additionally a key demographic that are driving the revival in popularity of board games (Graham, 2016) and hence this is why the game’s primary consumer group is this.
having an opportunity to voice their opinions on issues (West, 2020). This highlights how although this consumer may not initially be attracted to a concept where they have to voice their individual opinion, they will purchase the game as a way to aid their younger family members in speaking out. This is interesting as it presents how this secondary consumer is purchasing selflessly for their family in order to combat the lack of communication with it. Additionally, this consumer may be purchasing as a result of recommendation from the younger consumer, they will be purchasing as gifts and upon the advice of their younger family members who will be more likely to be initially attracted to the game.
Agree to Disagree’s secondary consumer group is the older generations and parents of the previous segment. The older generations, as presented in Stage One, were less open to talking about their individual opinions and instead focused on the positivity of youth
Behavioural and psychographic segmentation has been conducted on both these target markets in order to more deeply understand each consumer groups respectively.
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young millennials Demographic
The parents
Females and Males, aged 18-30, lower disposable income, degree educated or in higher education, job-seeking or employed in an entry lever position.
Demographic
Psychographic Active on social media, strong opinions and not afraid to voice them, spends disposable income on cause-driven products that offer a meaningful experience, more sensitive personalities who care about being heard and listened to, value-driven, thoughtful, aesthetically driven, want to learn more about politics and issues in the world, constantly changing and adapting their opinions. Behavioural
Females and Males, aged 4860, higher disposable income, educated but may not have entered higher education, employed in a high level (potentially managerial) role.
Psychographic Not as active on social media and only use it to communicate with family and friends, resourceful, rational, debatelovers, occasionally overbearing, politically engaged and have set opinions, value being ‘in the know’, want to provide for their families, caring, loving.
Actively seek products and experiences that optimise their understanding of the world and the people in their lives. They want to create meaningful experiences with their loved ones. Early adopter of popular brands and online trends, active and reactive on social media.
Behavioural
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Often feel they don’t understand the younger generations in their close circles, want to understand them better. They feel frustrated that the younger people don’t speak to them about issues. They are always looking for new, fun ways to bond with their family and friends.
The gamer toby
tOBY, 28, MATHS TEACHER Toby lives and breathes games, when he is not teaching and marking homework, you will find him playing on his games console or hanging out with his friends playing a board game. He enjoys games as it allows him to take a break from online activities. Him and his friends are always on the lookout for new and unique games to try.
loves
likes
dislikes
Gaming Maths and logic Colourful socks Playing games with friends Bringing games and fun to his lessons
Going to games cafe’s Taking breaks from the online world Coffee in all forms Watching TV
Telling off students Waking up early Exam season Boring games
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The gifter lisa
lisa, 58, sTAY AT HOME MOTHER Lisa is a devoted mother and recent grandmother. She is a homebody and is passionate about maintaining a loving family environment. Now her kids are older she enjoys having intellectual conversations with them and understanding their opinions, but she sometimes finds it difficult to bring topics up.
loves
likes
dislikes
Baking Giving gifts to family Her cat, Benny Feeding her family Shopping with her daughter
Pampering herself A good book Hosting dinner parties Interior decorating her house
Arguing with family A quiet home Her kids moving away Being thought of as old
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The talker eloise
ELOISE, 22, politics student Eloise is passionate about having open and honest discussions with friends and family, but she often finds they do not feel the same. She would love to find a fun alternative to reach the same goal of having an open discussion. Eloise is a politics student at Kings College London. She spends her free time shopping for vintage clothing, reading and going out with her friends.
loves
likes
dislikes
Politics and social issues Reading Daving discussions Going out Drinking wine with her flatmates in the evening
Vintage clothing Dyeing her hair Watching films and TV Wandering the streets of London Open-minded people Joining marches
Hypocritical people Being disorganised Staying home Unopen conversations Judgemental people
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consumer split
The Gamer 15% The Talker 45% The Gifter 40%
This graph presents the Agree to Disagree consumer split that is expected to arise. The majority of consumers come from The Talker segment as they are most likely to be open about wanting these difficult discussion. The second largest segment is The Gifter as many people purchase games such as this as gifts
for others, this segment is open to having the conversations and want to please their family/ friends. The Gamer is the smallest group as they play so many games and often are drawn to tabletop strategic games, however, they are open to trying new games such as Agree to Disagree.
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CHAPTER seven
the market
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market overview When assessing how Agree to Disagree will perform as a new entry into the market it is crucial to assess all the factors that may impact its potential success. Thorough market research into both the global and UK market is needed in order to understand its health and readiness for a new entry. As a result of the increasing use of digital technology, it may be assumed that the board and card game industry would be declining, however, the global market is healthy and rising. The growth of the industry has been cited to be in direct correlation with consumers taking a break from digital screens and focusing on face to face interactions (Arizton, 2019; Grand View Research, 2019). In terms of growth, the global industry is currently anticipated to reach a healthy $21.56 billion by 2025, with a CAGR growth of 8.7% during 2019-2025 (Grand View Research, 2019). More specifically in the UK, the current market is ÂŁ284 million and forecast to reach to ÂŁ327.4 million by 2023 (Euromonitor, 2019). With regard to market segmentation the proposed business concept fits within the card game segment. According to Statista the revenue in the UK card game segment will amount to ÂŁ98.16 million by the end of 2020 (Statista, 2020), presenting the strength of this sector for new entry success. Additionally, the independent game sector has seen the highest growth within the market over recent years (Graham, 2016). This is key for the Agree to Disagree as it is an independent game, so has the opportunity to enter into a successfully growing sector of the market. The success of both the global and UK market is incredibly positive as it shows how Agree to Disagree will be secure and have room to grow within the expanding market. However, the success and growth of the market is potentially leading to an oversaturation of products and hence lack of differentiation among new entry games. In order to be successful, Agree to Disagree must consider how value can be added both in-game and outside in order to differentiate itself from competition by offering a complete customer experience.
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Glo
b
k et r a M al k et
$21 billion by 2025
uk Mar
$327 million by 2023
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macro trends dIGITAL dETOX “Families are spending time playing board games, couples are taking cooking classes together, friends are taking walks in the park, etc. Even older millennials are replacing sleepless Saturday nights in clubs for funny nights playing board and card games as the ultimate hang out.” (Sanchez, 2020). In recent years it has become apparent that as a result of technology becoming one of the leading causes of anxiety, people are feeling the need to return to simpler times where human connections are valued over digital validation. People are turning to digital detoxing to combat the negative impact technology is having while mindfully disconnecting to reconnect (Sanchez, 2020). Digital detoxing and the consumer need to grow their human connections presents a large opportunity that the board and card games market can fill for the consumer, with many consumers already turning to games as entertainment with board games being considered as “one of the best ways to leave aside electronic gadgets and devices” (Arizton, 2019).
gENERATION HOMEBODY “Staying in is in. JOMO (joy of missing out) has never been more appealing for Generation Z, who are leading the homebody renaissance, spending more time than ever at home (Friend & Walpita, 2020). Generation Z are taking a break from hustle culture, burnout, political flux and the climate crisis by staying home (Friend & Walpita, 2020). As a key potential consumer for the games market and one of the key target consumer groups of Agree to Disagree, Generation Z staying in is a big opportunity as they are becoming more inclined to stay home interacting with their families and friends through playing games.
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Celebrity and Influencer Endorsements “Rising influence of social media and celebrity endorsements is expected to drive the demand for tabletop games” (Grand View Research, 2019). Over recent years, the games market has begun to see consumers wanting celebrity endorsements of games, looking to them to validate the success of a new game before they purchase. Although not a large contributor to the market sales, this avenue of game marketing has a large opportunity for growth as the use of influencers had dramatically changed other industries and the way they sell to consumers. Agree to Disagree has the potential to use influencers and celebrities in a way that has not been seen within the market before, disrupting the way consumers purchase games.
GAMES CAFES “The growing number of games café worldwide is helping companies attract a large number of consumers is the global board games market. These game bars and cafes are witnessing a remarkable success and gained immense popularity across the globe over the past few years. The rapid proliferation of game cafes is encouraging adults and teenagers to connect for meaningful interactions and discover new games in the global market“ (Arizton, 2019). One of the biggest drivers of the board game market is game cafes. Growing in popularity and number over the last few years, games cafés worldwide are helping to connect games to a large number of consumers. In the US alone, over 5,000 board game cafes where opened in 2016 (Arizton, 2019), presenting the speed of growth and consumer demand. Incentivised by socialisation and value for money, the key demographic driving the rise in games cafes is Millennials (Konieczny, 2019). Millennials, in particular, are seeking cheaper activities where they can socialise with friends and family.
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mIcro trends KICKSTARTER “The board game industry has shifted from being based in retail or game stores, dominated by publishers such as Hasbro, Parker Brothers, and Mattel, to the online marketplace where consumers are offered an overwhelming number of games created by countless designers and artists” (Kim, 2019) Kickstarter has dramatically changed the board game industry. In 2019 this category reached funding of $1 billion, marking around 17,000 successfully funded projects. The success of games on Kickstarter is continuing to grow YOY with a rise of funding of 19.6% from 2017 to 2018 (Kim, 2019). Before Kickstarter, board game designers would pitch ideas to publishers to receive funding, or they would have to fund their game on their own, which is extremely expensive. The platform brings mass access to creators where they can present games, instantly seeing if they are something consumers are interested in or not; this results in risks of game creation being minimised (Osborn, 2016). Kickstarter has: “Effectively lowered the entry level for table top game industry, allowing small companies and even individual designers to rise to fame through the successful campaigns of new and creative game ideas” (Kim, 2019). Due to the minimisation of risk and potential to create a large early following of Agree to Disagree, Kickstarter will be a key consideration for gaining initial funding.
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PESTLE ANALYSIS In order to understand the external impacts on the market and Agree to Disagree, a PESTLE analysis has been created. Additionally, the risk level of each macro environment has been determined in order to understand which area is of most importance to combat.
P
Brexit has caused uncertainty for businesses. Although the UK officially left the EU on the 31st January 2020, there is still uncertainty as the UK enters the transition period where many aspects of the future relationship are yet to be decided, such as the free trade agreement (BBC, 2020). As it is unknown what the trade agreement is to be, there is still the possibility that the UK will leave with no deal which would result in trading barriers and difficulty for business operations. The games industry has products manufactured worldwide being transported to the UK, the ese of transportation is at risk with the potentially of significant increases to lead times on product delivery. This will mean the games market and Agree to Disagree will have to have systems in place to handle the uncertainty and be resilient of the changes.
Risk level: Amber
E
It is important to consider disposable income as games are leisure products and so to many are unnecessary. The median household disposable income in the UK was ÂŁ29,600 in financial year ending 2019 (Office for National Statistics, 2020). The rates of disposable income is important for the games market and Agree to Disagree as they are non-essential products; however if costs are kept low then customers will be more inclined to purchase. However, as games are purchased once, there are no additional costs and the game can be played countless times, customers may feel able to purchase as there are no hidden/surprising costs.
Risk level: Amber
The economy continued to show no growth overall since October 2019 with the UK gross domestic product (GDP) remaining flat with zero development (Office for National Statistics, 2020). Amid Coronavirus fears The Bank of England announced an emergency cut in interest rates (on the 11.03.2020), with policymakers reducing rates from 0.75% to 0.25%, taking borrowing costs back down to the lowest level in history (Chan, 2020). As a result, borrowing money from banks will become more beneficial to a smaller business as the interest is so low, however, Agree to Disagree is looking at all finance options to raise initial funds. On the other hand as the interest rates are cut there are suggestions that the UK economy could shrink in the coming months (Chan, 2020) which has the potential to lead to wider economic struggles impacting the games market.
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The risk is rated amber as the lead times on games can be fluctuated fairly easily as there is no timing consideration for product expiry or ease of damaging. Agree to Disagree will be able to combat the potential risk of extended lead times as most of Year 1 falls across the transition period where trading isn’t set to change much. Additionally, stock numbers will start low and orders will not be made regularly. The economic risk is rated amber, as amid Coronavirus fears there is strong economic uncertainty that may prove difficult to combat from a small start-up and the wider market.
S
As mentioned previously, the uncertainty of Coronavirus has the potential to impact the market and the new business significantly. In terms of manufacturing and shipping of products in the games market, game manufacturing is “largely synonymous with China and while there are other options worldwide, many of them still turn to China for specific components that simply aren’t made at scale anywhere else” (Stonemaier Games, 2020). To combat this, manufacturing outside of china will strongly be considered with Agree to Disagree. Additionally, in the UK many are being told to stay home in self-isolation. This has the potential to impact wages and in turn disposable income which would mean less money to spend on unnecessary items. On the other hand, as people are in self-isolation and staying home there is a need for in-home entertainment and board games fit within that category.
Risk level: Red
T
As stated previously consumers digitally detoxing is having a large impact on the board games market with consumers reaching for entertainment that will provide positive human connections offline.
Risk level: Green
L
E
Global ecommerce sales were anticipated to hit $3.46 trillion by the end of the 2019, up 17.9 percent from 2018’s figure of $2.93 trillion. Further, by 2022, ecommerce sales are expected to reach $892 billion in the U.S. alone (Thomann, 2020). Consumer spending online has a significant impact to the games market as more consumers are looking to purchase products online. Although the strongest distribution channel remains retail, online distribution is growing significantly, and games need to be available online and in-store in order to have the presence necessary for success.
Due to the immediate impact of Coronavirus on consumer spending habits and manufacturing, it is key to have risk barriers in place to combat. Manufacturing of the new game will potentially be completed outside of China and bricks and mortar retail will possibly be lowered as less consumers go to retails shops to purchase. Although the risk is rated red, the risks can be dealt with using strategic manufacturing and distribution. There is no risk with the technological impacts to the games market and Agree to Disagree as technology is aiding the sales of games, making them more accessible and pushing consumers to take a break from tech to play games.
As the board game market is growing successfully it becomes attractive to others and so plagiarism and plagiarism allegations take over as games take a lot of creativity in the concepts (PlagiarismToday, 2018). As a result of the industry being based around creativity, there are many issues surrounding intellectual property and how far it can go. Because of this, new entries into the market need to be careful as they have little power in their creative rights; Agree to Disagree will need to be covered by copywrite protection so that the game concept cannot be stolen by others. Constant research into other new games needs to be done to ensure that they are not infringing on those protective measures.
Risk level: Amber
In recent years, sustainability and impacts on the environment have been taken incredibly seriously by consumers. in terms of the games industry there may be arguments against as the initial manufacturing of board games and the shipping of them around the world isn’t good for the environment. However, board games can be reused over and over again and playing a board game has a very low carbon footprint. In order to combat this Agree to Disagree will consider its environmental impact through its packaging and game design.
Risk level: Green
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The legal risk has been rated Amber as after the new game gets covered by copyright protections it should be safe from the concept being taken. However, these protections do not cover adaptations to be taken and inspiration for new games.
The environmental risk is rated green as initiatives can be put in place that make the Agree to Disagree environmentally sound.
MARKET COMPETITIVENESS AND STRUCTURE The market runs on a monopolistic competitive configuration (Economics Online , n.d.). The monopolistic competitive structure means companies have many competitors, but each sells a different product. This creates a space where customers can purchase many different games, each filling a different need. As a result, although competing against other games, Agree to Disagree is in a good position to compete as it has a strong USP and real consumer benefit. Within the market there are large players such as Hasbro and Ravensburger who own and publish many high-profile games such as Monopoly and Cluedo. These largescale enterprises dominate the market as they have the scope to gain revenue from many games and they drive mass sales within the market, allowing them to offer low prices to the consumer. While it can be said that Agree to Disagree is competing with these large players, the primary competition is the individual games themselves. The independent games sector has seen extremely high growth in recent years (Graham, 2016) with games such as Cards Against Humanity and What Do You Meme driving this. Within this area of the market there are many competitors for Agree to Disagree, however as they all offer different experiences when playing there is room for all to compete successfully. Agree to Disagree’s primary competitors are independent games that offer meaningful experiences in a fun way.
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competitor analysis Competitor Universe Model By using the Competitive Universe Model (Burstein, 2012), Agree to Disagree’s competitive landscape is clearly mapped out (see appendix 17 for initial model inspiration). In the inner circle sits Agree to Disagree with core competitors of games with a similar play style, offering meaningful experiences rather than just entertainment. The second circle are secondary competitors of independently run games, however these games do not offer the same meaningful USP as Agree to Disagree, instead are for entertainment only. The final circle holds the tertiary competition of widely known games and game publishers. These games have become ‘household’ names and almost everyone has played them at some point. Although Agree to Disagree is still competing with these games, it can be said that most people/families already own these games and so will not repurchase.
Thir
d–
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Middle - offer
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Competitor analysis A competitor analysis (see appendix 12) has been created to provide detailed understanding of the strengths and weaknesses of competitors. Analysis of all levels of competitors, primary, secondary and tertiary allows greater knowledge of the wider market. It is clear that areas such as social media presence is a weakness of most competitors, hence Agree to Disagree will ensure a strong social media communication strategy is in place.
market positioning model Positioning maps have been created to indicate the positioning of Agree to Disagree within the market in relation to competitors. The two maps measure Agree to Disagree against all levels of competition, primary, secondary and tertiary, in order to clearly see where they fit within the wider market. The variables chosen are price vs experience type and social media presence vs relationships type. These variables have allowed understanding of where Agree to Disagree differentiates from its competition as it clearly shows that the game sits in clear segments for both maps, with the game offering a meaningful experience with at a lower price points and having a strong social media presence and being used to strengthen current relationships.
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porters 5 forces model Porter’s Five Forces Model has been used to identify and evaluate the competitive threats Agree to Disagree may face as it enters into the market.
Competitive rivalry As identified in the competitive analysis and positioning maps, although there are some close competitors with We’re Not Really Strangers and Big Talk, these games are primarily US based and Agree to Disagree has enough differentiation against them to stand out. The positioning maps clarified that Agree to Disagree is able to own its own segment using its USPs . Threat Level: Green
Threat of Substitutes There is not a big threat of substitution for Agree to Disagree as measures will be put in place to protect against plagiarism. There is the opportunity for adaptations to be created, however as the first to market, Agree to Disagree will have a strong market presence within the category. Threat Level: Green
Threat of New Entrants As the consumer interest in games increases there are many new entrants to market each year. However as Agree to Disagree has a strong USP and wide consumer appeal there is a strong chance of the game outperforming other new entrants which offer products similar to those already in the market. Threat Level: Green
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buyer power As a start-up beginning with no customers, the buyers have the power to ‘make or break’ the success of the brand. However, with a strong USP and the meaningful offering for the consumer, they will be much more inclined to purchase Agree to Disagree over other games. By offering the meaningful experience there is an opportunity for Agree to Disagree to then grow a brand-consumer relationship with strong connections over social media and events. By offering an in-game and out of game experience, consumers will then become loyal to the brand, purchasing future expansion packs and engaging over social media. Threat Level: Green
suplier power The wide range of UK based, and worldwide manufacturers provides Agree to Disagree with many options to source manufacturing of the game. However, due to the low number of initial quantities the cost of getting the product manufactured in the UK may be costly and so other locations will need to be considered while thinking about the external factors impacting the manufacturing and distribution process, such as Brexit and Coronavirus which are both having an impact on trading. As international distribution becomes more difficult the bargaining power of the UK suppliers will increase as they are in higher demand. All manufacturing options will be considered to ensure the price and quality of the products is kept intact. Threat Level: Amber
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MARKET READINESS The board game market is in extremely good health for new entries and is continuing to grow, presenting the growth potential for Agree to Disagree. While the market is saturated with many games of varying types and levels, the category of games offering a meaningful consumer experience is fairly untapped and so Agree to Disagree will be one of the first entrants offing this consumer benefit. With its strong USP and differentiation points, it can be said that the market is ready for a game such as Agree to Disagree to enter and offer the consumer something.
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CHAPTER eight
strategic direction
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where is the brand now? Agree to Disagree is a start-up business and so there are no previous figures to base their current situation on. Overall, the current situation is being based on market research looking at other start-ups in the same market. Industry interviews (see appendix 6 and 7 for full transcripts) have been conducted with similar start-ups to determine their initial process of entering the market and the successes/struggles they faced.
swot analysis In order to fully understand and outline the current starting situation for Agree to Disagree, a SWOT Analysis has been created. The SWOT presents how there are many areas of strength that Agree to Disagree already has propelling them to be successful in the market, however they need to remain conscious and aware of the opportunities and threats that may have significant impact on the business.
Strengths • • • • •
opportunities
Strong USP and unique meaningful offering for • the consumer. Market Innovator, as there are no direct competitors within the UK offering the same meaningful game experience. Bold and honest brand message and strong consumer communication. Community of consumers by the after-purchase experience. Lower price point to most competitors will allow a degree of differentiation within the market. • it is important that the price of the product remains low for the consumer to ensure they • have that competitive edge.
weaknesses •
•
Zero brand awareness as a new entrant into the market. Therefore, it is crucial to implement a strong initial communication and marketing strategy to effectively launch the business and generate awareness. Limited scope of direct to consumer communication through customer services and email. This is due to their being a small staff team to do these efforts. However, as the consumer is key the business success, this will be for fronted as highly important to be completed as fast as possible.
Extend the online brand to have a strong online presence. By ensuring a strong social media presence and use of influencers, the brand can further differentiate against competitors who are lacking their digital presence. Additionally, by offering this social presence there is more scope to continue the consumer relationship after purchase, keeping them engaged with the brand for further purchases and a better overall relationship. Expand the product range at a later date to ensure the longevity of the business. Utilise the consumer appetite for sustainable and environmentally conscious products/ brands by maintaining the UK production and use of FSC certified materials.
threats •
•
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Large, historic competitors are continuously bringing out new product ranges so they may take some sales over a new entrant. However, the meaningful offering over competitors pushes consumer desire for the product. Continuously changing conversation may mean the topics within the game become quickly outdated, however, by creating game extensions new up-to-date topics can be added when necessary.
ansoff matrix To understand how Agree to Disagree is entering the market an Ansoff Matrix Model has been utilised. The Ansoff Matrix presents that Agree to Disagree will be using a Product Development strategy whereby they are bringing a new product type into an existing market.
Market penetration (existing product, existing market)
Product development (new product, existing market) Agree to Disagree is a new game style that offers a meaningful customer experience which is not currently found in the UK games market. The game will be entering into the UK games market which is an existing successful market that has the scope for growth for Agree to Disagree.
Market development (existing product, new market)
Diversification (new product, new market)
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long
te
where does the brand want to go?? rm
g o a r l a s e y 5
To be recognised across the UK as a popular game To have multiple extensions out To be stocked in over 10 large retailers across the UK To have a large following on social media.
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vision
The brand is looking to be a well-known game in the UK games market and have a enterprise of multiple extensions created to support the original game.
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CHAPTER nine
marketing strategy 79 79
MARKETING STRATEGY AIM AND SMART OBJECTIVES 80
year one brand launch 2021 The first year will focus on the brand launch, growing the initial brand awareness within the market. The brand will launch in June 2021 with the ‘Let’s Get Talking’ campaign which will include the launch of all social channels, a social campaign using influencers and paid social media advertisements, the launch of the brand podcast and the launch event of the popup café in London. By using a pop-up café launch event, the game can be tested by consumers while capitalising on the popularity of games café’s in the UK. The success of the launch pop-up will additionally determine whether events will be a good marketing strategy for Agree to Disagree to take in the following years. After the launch campaign the rest of Year One will focus on driving sales and building brand engagement ready for the Christmas period which has been deemed a key time of year for game sales. Continuous engagement across social media and the podcast will ensure the creation of a brand community and differentiation from competitors who do not focus on their digital strategies. Within the first year the game will be stocked on Amazon, John Lewis, Smyths and Sainsbury’s. By having the game stocked in these retailers the awareness among potential consumers will grow as they see the game within stores and on their websites.
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year two brand growth 2022 Within the second year, the brand growth is the main focus. The stockists will be increased to 10 key retailers including the initial ones stated in year one, this means organic growth in awareness will be increase through the game presence in these new stores. The social media presence of the brand will be continually pushed to promote the brand and to ensure a good Christmas sales period, there will be another Christmas campaign with the addition of Christmas pop-up events, following the success of the previous launch pop-up. In order to support this growth strategy another team member will be hired to manage the social media and overall online presence of the brand to guarantee this activity remains strong.
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year three PRODUCT EXPANSION 2023 Year three will focus on the product of expansion of Agree to Disagree to ensure the longevity of the brand and its continuous relationship with consumers is maintained. Another launch pop-up event will run alongside the new product launch to grow awareness and excitement surrounding the game. The brand’s physical presence will continue to grow in the third year, with the game and extension pack now being stocked in 20 retailers in their stores around the UK. By this point the sales of the original game will have substantially grown since the first year, these consumers will be targeted through varying communication methods to purchase the extension pack.
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CHAPTER ten
communication plan
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comms plan aim & objectives
s nd’ bra e th nch and u a yl ms ers. full strea s s e n sum ucc icatio h con s c To m u n rea c o m t i ve l y c ef fe nd ee bra isagr g n D s t r o r e e to i e n c e n e t a Ag er aud e r s o ne. ge n e s s of rget o l l ow ro a T 1. w a r e n t t h e t 0 0 0 f o o f y e a , a s 6 end ng ong , a m c hi evi y th e s i te f b b a e o m w by gra a te n d he r t a t o Ins iew ct ee a f f i r a g e v by t h r t th, r i ve ave o d g an a mon T s 2. nin nch ga i 0 view . lau a ll of e 0 e n 0 o 1, ot f d th ear hol aily fo y of y l d ful ess ning a . c c s u y g a i r d ay To 3 . ve n t b p l e p e e peo 10 0
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aida & drip models
In order to create a fully comprehensive communication plan that works effectively, it is crucial to understand the cognitive stages a consumer will go through during the buying process by using the AIDA and DRIP models.
aida awareness A strong social media presence will aim to generate awareness prior to the launch and afterwards. Consumers will be encouraged to share their game experience through hashtags and social posts, this organic content is crucial as consumers trust their friends and families over brand content.
interest Generated through organic influencer posts, the launch event and in-store demonstration promotion. This will grab the attention of potential consumers and make them want to impulse purchase out of interest.
desire By gaining user generated content the consumer desire amongst their friends and family will rise. Similarly, by gaining organic influencer content consumers will be more open and trusting of the content being posted, wanting to attain the influencers admirable lifestyle. The podcast aims to grow a community of listeners who are looking to learn from each other, get talking on issues and understand others opinions through a transportive platform.
action By having the social links on the packaging, and having the socials prominent on the website, there is a call to action (CTA) for consumers before and after purchase. The email marketing will have immediate CTA for consumers to follow, ensuring the click-throughrate (CTR) on emails is successful. The paid advertisements on Facebook and Instagram will additionally have CTA links that improve the CTR rates on the advertisements which will potentially lead to higher conversion rate.
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drip Differentiate The brands USP and meaningful consumer experience is the main way Agree to Disagree will differentiate itself from competition; however, by having a strong social media presence and by using influencer recommendations and content, they are offering fresh promotional platforms that consumers do not normally receive for games.
Reinforce Agree to Disagree will continuously reinforce the why behind their brand that presents their meaningful USP. By reinforcing the brands why of making difficult conversation fun in order to break stigmas and create closer bonds, the consumer will believe in the brand more and be more likely to purchase.
Inform Through the varying platforms the brand will educate and inform their consumers of the importance of talking to each other even when it may seem difficult at first.
Persuade The brand aims to persuade consumers to enrich their lives and better their familiar/friend relationships through talking.
88 88
89 89
OFFLINE CHANNELS In Store Demonstrations In store demonstrations in John Lewis stores will be held over the Christmas period when shops are busy with shoppers. The demonstrations will be held in London based stores as they get much more footfall than a other locations. This form of marketing was chosen after the obvious success for Accentuate. Owner and creator Fraser-Bell stated in an email interview:
“(demonstration days) are the most valuable, low cost marketing we can ever achieve� (Fraser-Bell, 2020, see appendix 6 for full transcript). As a result of this recommendation Agree to Disagree will complete three demonstration days within the first year and if successful continue to hold them more frequently in continuing years. The demonstration days held by Accentuate reach a conversion rate of 36% (see interview transcript in Appendix 6) which is incredibly high, showing the potential for Agree to Disagree grow their awareness and sales. The initial equipment is low cost with just standing banners needed, and the only other cost is travel which is minor. This presents how demonstration days are a key communication strategy for Agree to Disagree as they have maximum impact for minimal cost.
90
91 91
In store demonstration banner
92 92
press As well as direct from the brand communication, Agree to Disagree will make use of external PR such as magazines and news outlets. Traditional media will remain important for the brand as it reaches the older consumer who is more trusting of news and magazines. By gaining appearances in these press outlets, the game can expand their reach by utilising their readerships. A press release will be created for the brand launch to gain media interest in the brand (see appendix 15 for press release). The press release will be sent to industry specific media, as well as local and country-wide newspapers and magazines. As the press release can easily be sent to these publications with little to no cost, a high volume can be sent out is key to gain as many features as possible.
93
online CHANNELS instagram “42% of the UK population are Instagram” (Avocado Social, 2019)
on
Agree to Disagree’s Instagram content will emphasize the community nature through the use of UGC, exclusive follower content and stories of behind-the-scenes content. Instagram is aiming to provide immediate consumer CTA of commenting, sharing, liking and following. Though this engagement a closer brand-to-consumer bond is formed which leads to brand loyalty.
With nearly half the UK population being on Instagram, marketing though the platform will be key for the brand reaching their target consumer in a cost-effective way. Through the use of consistent imagery and colour palette, Instagram will solidify Agree to Disagree’s visual identity to followers while allowing a platform for further consumer engagement. Both created and user generated content (UGC) will look to encourage sales and brand engagement.
Some Instagram paid advertising will be used as a way of reaching new consumers through the platform. This form of advertising reaching users of the app who are not already followers and grow the reach of the platform.
“Brand engagement rises by 28% when consumers are exposed to a mixture of professional marketing content and UGC” (Cahill, 2018).
Daily
The brand will have a general weekly and daily structure to the organisation of the Instagram and the posts.
Weekly
Messaging loyal followers who have supported Liking and commenting on the own content the brand and created UGC, thanking them for comments from followers to reinforce the contheir support. sumer-brand relationship. Liking and commenting on consumer accounts Highlight maintenance of story uploads. who have mentioned Agree to Disagree, following back some loyal followers to create further brand-consumer bonds. Strategic following, commenting and liking of similar accounts with similar messages and high follower counts.
Using a social media uploading/organisation website (such as Hootsuite or Later) to set up the week’s posts so they do not have to manually be posted every day. This ensures maximum organisation and efficiency as it makes a time consuming task fast and effective.
1 post a day, with engaging captions ad relevant use of hashtags. Up to 3 posts a day during a specific campaign or offer. Posts to be uploaded during peak times (8am-12pm). At least 1 story post a day to create user engagement, through polls/quizzes and calls to actions. Stories can be calls to action, behindthe-scenes footage from the office or events, Q&A’s etc… 94 94
95
influencers Micro influencers are individuals with between 1,000 to 100,000 followers and come with a much higher engagement rate than their larger counterparts of macro influencers. With an engagement rate of up to 85% (Anderson, 2019), micro influencers are able to connect more deeply to their audiences and have a more trusting, ‘peer-like’ relationship. For a brand this is key as 84% of consumers say they trust recommendations from peers over advertising (Anderson, 2019).
and the potential for Agree to Disagree to differentiate against competition by utilising this opportunity. In the first year, 300 micro influencers will be sent the game in order to create organic content for the brand. For the first year, paid content will not be used as it is expensive when the success of using influencers is yet to be tested. By sending the product to the influencers the only cost to the brand is the cost of sale price. The micro influencers chosen will represent the brands message and fit with the ideal consumer types.
For this reasoning a mix of micro and macro influencers will be used within the marketing strategy to grow awareness, moving away from the traditional methods used by games. Using influencers and social media may be a risk for the brand as it is not known how successful it will be for a game as it is not done by competitors. However, it can be said that the success of other industries and their use of social media influencers to market products presents the opportunity being missed by the board games industry
The following influencers are some that will be chosen to send the game to as they fit ‘the talker’ consumer type, however, influencers from all consumer segments will also be chosen although there are less influencers that fit these consumer types as they are less social media savvy and therefore communication tactics outside of social media will be used to target these consumers.
96
97 97
facebook and Linkedin “Facebook is the leading social platform, reaching 60.6 percent of internet users� (Mohsin, 2019). Facebook will be utilised by Agree to Disagree as a key touchpoint for consumers to engage, sharing posts and commenting on content. By using Facebook, the brand can reach a wider audience than just through the use of Instagram which has more opportunity with the young millennial consumer group. Facebook will be posted on less regularly than Instagram and will utilise more video content than imagery as it is more interactive. This video content will be offering podcast video clippings, behind-the-scenes content and interactive live streams. This video content will help the brand engage on a deeper level with their consumers. Paid advertisements will additionally be used on Facebook. These advertisements will have clear CTA for consumers as a way of promoting sales of the game and raising awareness of the brand. LinkedIn will be used as a way for the sales manager to make connections and grow the sales opportunity for the game B2B. Although a minor social media platform for Agree to Disagree, LinkedIn is a key way for the brand to make B2B connections with potential suppliers.
98
email “Email marketing is by far the most effective channel to attract, engage, and connect with an audience to drive sales and revenue for your business� (Campaign Monitor, 2019). Email marketing will support the online communication as a way to directly communicate with already engaged consumers. Through fortnightly emails Agree to Disagree will be able to drive online sales and advertise events; the success of which will be monitored using the click-through rates. By using customer data, hyper-targeted, personalised communication will be utilised to ensure significant ROI and reinforcement of the consumer-brand bond.
99
website In order to appear professional and enticing to new consumers it is important that Agree to Disagree has a visually appealing website. Additionally, as they are selling the game through the website it needs to work effectively as an e-commerce site. To ensure the best website possible is created a website developer will be hired to create the website, making it fit for consumer use. The website will be launched in May before launch so that any consumer CTA from social media will bring consumers to the website where they will be able to sign up for email updates regarding the launch and any ongoing promotional email marketing.
100
101 101
podcast Podcasts have grown in popularity over the past few years with 7.1 million weekly listeners in the UK, doubling over the last five years (Ofcom, 2019). This growing medium will be used by Agree to Disagree to create an additional product offering for consumers at a low cost. Due to the nature of the brand aiming to get people talking, the fortnightly podcast will highlight the core brand message by featuring the host (the brand’s marketing manager) and a guest talking through important issues and their opinions on them. The guests will be from a broad spectrum of areas, from prominent figures in specific areas such as politics to influencers who will be able to expose the brand to their followers. The aim of the podcast is to offer consumers another platform to aid understanding and education on the topics they care about in an easily digestible, fortnightly format of 25-minute episodes.
Name
Let’s Get Talking: A Podcast by Agree to Disagree
Hosts
iTunes, Spotify, Apple Podcast
Content Description
Whether we agree or disagree…it is important to get talking about the things that matter the most.
Average Episode Length
25 minutes
Upload Frequency
Fortnightly
Upload Day
Sunday
102 102
103 103
launch campaign The launch campaign ‘Let’s Get Talking’ will run from May until the launch in June 2021. The main aim of the campaign is to successfully launch the brand though social media, podcast and a final launch event.
Social Media Campaign The #letsgettalking social media campaign will use UGC and created content to grow brand awareness and engagement. As a start-up the brand may not get a high-volume of UGC at first, so the aim is to focus on the use of the hashtag across all socials to present clearly the brand message and the importance of talking to each other. This will be done by sending out product to influencers during May 2021 and getting them to create the initial UGC and grow the preliminary awareness of the brand to their followers.
Podcast Launch The podcast will launch early June 2021. The first episode will feature the staff members of the brand discussing the brand and starting the initial conversation of what the podcast episodes will go on to cover. The podcast will then be launched and promoted across all other socials to gain awareness and grow the listener numbers.
104
Example Instagram Story Post
105
Launch event The launch event in late June 2021 is aiming to gain awareness of the brand outside of social media, while creating a buzz surrounding the product. A cafĂŠ event space has been chosen to hold the event as it replicates the popular games cafes. London was the chosen location for the event as it holds high footfall potential and is easily accessible for many. The space will invite passers-by and invited guests to attend the cafĂŠ and play the game with their friends and families. Gifts such as free cakes and coffees will be provided to people who post on their social media, tagging the brand and using the hashtag. Among the invited guests will be friends and family of the brand employees, influencers and press contacts. By utilising both general footfall and inviting guests, the event should be able grow awareness and buzz through UGC and the continuous use of the hashtag.
floorplan decorative mirror
table and chairs
sofa and table shelving with product
106
ent
ran
ce
bar/cafe counter
hanging speech bubbles against window
sofa and table
original cafe space in london
floating shelving with product on
orange sofas and chairs
lets just agree to disagree
decorative ‘instagramable’ mirror
laser cut speech bubbles, hanging at window and on celing 107 107
kpi’s of Launch The key KPI’s assessing the success of the brand launch are the number of times the hashtag has been used at the end of the campaign, the number of initial sales within the launch, the number of UGC posts from general public as well as influencers, the email newsletter signups, traffic to the website and the follower increase on social media.
Pre -Launch Launch social media accounts and post the initial promotional posts for #letsgettalking Launch website and begin getting email sign-ups Launch Podcast Send out launch press release Send out launch invites Send out 100 units to infleuncers Launch event Post-Launch Weekly social media posting on all socials Website communication Send out 100 units to infleuncers each month Fortnightly podcast release Fortnightly email marketing Paid Facebook Advertisements Paid Instagram Advertisements Instore Demonstration in John Lewis 108 108
Apr ‘22
Mar ‘22
Feb ‘22
Jan ‘22
Dec ‘21
Nov ‘21
Oct ‘21
Sep ‘21
Aug ‘21
Jul ‘21
Jun ‘21
Communication Type
May ‘21
Tactical communication timeline
YEAR TWO AND THREE COMMUNICATION OVERVIEW Communication activities in Year Two and Three will be dependent on the performance of Year One. Successful activities in Year One will be continued into the following years and other not as successful tactics may be dropped to offer the opportunity for a different direction to be taken. Marketing will align with campaigns in both years around Christmas and the product expansion in Year Three, including events following the achievement of the launch event. Outside of the specific campaigns, the brand will work on increasing brand awareness following the expansion into new retailers, this will be completed by growing the use of influencers (if found to create a ROI in Year One) and increase the reach of Instagram and Facebook advertisements. As the product is expanded into more retailers, more in-store demonstrations will be utilised at new locations outside of John Lewis in order to promote the product in these new retailers. Additionally, the brand-consumer relationships will be strengthened by increasing consumer engagement through communication, ensuring organic brand loyalty is created.
109 109
CHAPTER eleven
financial outlook
110 110
111 111
RAISING CAPITAL AND START UP COSTS Initial investment of £30,000 is needed to cover the start-up costs and initial first year costs, this can be seen added to the finances in the Cash Flow Forecast (see appendix 26 and page 120). The investment is needed to ensure the implementation of the marketing and communication strategy can be fulfilled and provide security for the brand’s survival. Sourcing finance from a variety of places will ensure ease of procurement for a larger amount of capital. The funding of £30,000 will be spread across all four platforms of personal investment from the CEO, friends and family investment, Kickstarter and a loan from Start Up Loans (Start Up Loans, 2020). The majority of the investment will come from the Start Up Loan investment, raising £15,000. Kickstarter will be used to gain £5,000 of investment. Kickstarter was chosen
as it has proved key for the board games market. Additionally, Kickstarter has: been recommended by Hazel Reynolds as a starting point for game companies: “Kickstarter was fantastic for us. It allowed us to test the idea, publicise the game and raise the money we needed to get the first edition printed. It gave us a little group of fans before we’d even made our first game! I would definitely recommend it to you as a single game company, as it’s how we started” (Reynolds, 2020, see appendix 7) With Reynolds first game, Randomise, using Kickstarter to raise £4,000, it can be said that the aim of raising £5,000 is extremely doable for Agree to Disagree. The remainder of the investment will come from personal savings and family and friends’ investment.
-up loan t r a st
kickstar
ter
£5,000
pe r
& family s d
£5,000
al savin n o s
gs
frien
£15,000 £5,000 112
Start Up Expense
Cost
Intelectual Property Copywrite
£7,500
Business Rates
£0
Business Registration
£12
Insurance
£447
Accountant Fees
£1,000
Bookkeeping Software - £9/pm, paid in full at beginning of year
£108
Domain Name URL
£11.99
Website Design and Development
£1500 design, 500 maintenance (paid halfway through the year)
Office Supplies
£100
Game Design and Branding
£1,500
Micellaneous/Petty Cash
£300
Total
£12,478.99
Within the first year of operation, the start-up costs occupy a significant percentage of outgoings within the first month of May with a total of £12,478.99. The rent, utilities and marketing costs have not been included in the start-up costs as they are presented in the Profit and Loss Account separate to the start-up costs. Justifications for all start-up costs can be found in appendix 23.
113
SALES FORECASt A Sales Forecast has been created as a way of estimating the Year One sales. Full calculations and tables in appendix 19 and 20.
62.5%
i m l lion 2 . 9 1 families in the uk (ofns, 2019)
of people purchase new games once a year primary research survey
62.5% of 19.2 million = 12,000,000 Then assume only 1% convert to actually purchase a new game: 1% of 12,000,000 = 120,000 potenital customers Agree to Disagree is a start up so assumed that only 10% of potential consumers will purchase: 10% of 120,000 = 12,000
114
Using this annual figure of 12,000 consumers within the first year, this figure has been divided up between the revenue streams of revenue from Amazon, the website and retailers (justifications found in appendix 18). A significant amount of sales are estimated around Christmas when communication increases and consumers are pushed to purchase. With all revenue streams, the sales rise over the seasonal period and then drop again afterwards. In the other months there has been an estimated steady rise each month as Agree to Disagree gains awareness over the year. The sales forecast leads to a net profit of ÂŁ42,960.39 (see profit and loss), this is realistic for a game such as Agree to Disagree as competitor Accentuate made a net profit of ÂŁ57,000 in their first year (Dragons Den, BBC2, 2015). The full sales forecasts for all three years can be found in appendix 20.
Revenue Stream
Percentage of Sales
Amazon, 4,600 units
38%
Website, 1,400 units
12%
Retailers, 6,000 units
50%
The assumed sales in the second and third years has increased as a result of the brand awareness increasing, and a new product being developed for Year Three. There is a slow growth within each month outside of the Christmas period of both years and around the product launch of the game extension in October of Year Three (2023).
115
profit and loss account The Profit and Loss Account present that Agree to Disagree will be profitable within the first year of trading and breakeven in December 2021 after seven months. The fact that the company breakeven after only seven months is extremely positive for the brand as they are making profit fairly quickly into the year. The final net profit for Year One is £42,960.39, which is a healthy ending figure for a start-up at the end of its first year. This also presents that the company has met its aim of becoming profitable within the first year.
Within the second and third year, Agree to Disagree remains profitable and easily has the ability to pay back outstanding payments on loans within these three years. The final net profit for Year Three of £271,082.05 shows how there will easily be the funds for further expansion after the first three years of trading, which is a promising position for Agree to Disagree to be in.
Year One
Year Two
Year Three
Revenue from Amazon Revenue from Retailers Revenue from Website
£82,800.00 £71,280.00 £25,200.00
£180,000.00 £142,560.00 £36,000.00
£315,000.00 £231,660.00 £54,000.00
COS for Amazon (£5.50/unit) COS for Retailers (£4.70/unit) COS for Website (£4.70/unit)
£25,300.00 £28,200.00 £6,580.00
£55,000.00 £56,400.00 £9,400.00
£96,250.00 £91,650.00 £14,100.00
Gross Profit
£119,200.00
£237,760.00
£398,660.00
Podcast costs Facebook Advertisements Instagram Advertisements Influencer Product Costs Instore Demonstrations Event costs New Product Launch Campaign Costs (y3)
£59.98 £870.40 £872.00 £810.00 £293.99 £5,000.00 £0.00
£0.00 £1,792.00 £3,324.50 £1,890.00 £595.00 £5,000.00 £0.00
£0.00 £1,792.00 £3,324.50 £3,240.00 £1,360.00 £15,000.00 £1,500.00
Total Marketing Costs
£7,906.37
£12,601.50
£26,216.50
Start up costs Rent and utilites Fulfilment Cost (Tamazi Base Rate) Wages Website maintenance NPD costs (y3)
£12,478.99 £4,500.00 £862.25 £49,992.00 £500.00 £0.00
£0.00 £4,500.00 £862.25 £69,996.00 £500.00 £0.00
£0.00 £4,500.00 £862.25 £94,999.20 £1,000.00 £2,000.00
Total Overhead Costs
£68,333.24
£75,858.25
£101,361.45
Total Marketing and Overheads
£76,239.61
£88,459.75
£127,577.95
Net Profit
£42,960.39
£149,300.25
£271,082.05
Full Profit and Loss Acounts for all three years can be found in appendix 21 and justifications of prices can be found in appendix 22
116
Activity
Year One
Year Two
Year Three
Podcast
£59.98
£0.00
£0.00
Facebook Advertisments
£870.40
£1,792.00
£1,792.00
Instagram Advertisments
£872.00
£3,324.50
£3,324.50
Website
£2,000.00
£500.00
£1,000.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
Influencer Product Cost
£810.00
£1,890.00
£3,240.00
Stand Up Banners
£38.99
£0.00
£0.00
Travel Expenses (approx £85 per demo)
£255.00
£595.00
£1,360.00
Venue (including utilites)
£2,750.00
£3,000.00
£9,000.00
Decorations
£500.00
£500.00
£1,500.00
Catering
£350.00
£200.00
£600.00
Press Release
£0.00
£0.00
£0.00
Staff
£1,400.00
£1,300.00
£3,900.00
Campaign Costs
£0.00
£0.00
£1,500.00
Budget (10% of GP)
£11,920.00
£23,776.00
£39,866.00
Total Spent
£9,906.37
£13,101.50
£27,216.50
% of Budget Spent
83%
55%
68%
Instore Demos
Events
Product Expansion Campaign (Year Three only)
For the marketing budget of each year, 10% of the Gross Profit has been used as the budget outline (Nuphoriq, 2020). This means the budget increases YOY as the Gross Profit rises. In Year One the highest percentage of the marketing budget was utilised, however, within the first year there where starting costs for marketing materials that will be reused. Justifications can be found in appendix 22 and full table can be found in appendix 24.
marketing budget 117
sensitivity analysis It is clear from the Sensitivity Analysis that even if the sales dropped by 20%, the business would still be in a profitable state within their first year, with £19,120.39 net profit. This is incredibly positive for the company as it shows how the brand has flexibility to cope with unpredicted issues that may arise and would still have the strength to continue trading. Although in a much stronger position that Year One it is still important to evaluate their sensitivity of Year Two and Three as a way of predicting growth within the three years. It is clear that within both Year Two and Three that the 20% drop in sales makes little difference to the growth of the company and presents how the company is not very sensitive. Full tables can be found in appendix 25.
year One Base
+ 20%
- 20%
Revenue
£179,280.00
£215,136.00
£143,424.00
Cost of Sales
£60,080.00
£72,096.00
£48,064.00
Gross Profit
£119,200.00
£143,040.00
£95,360.00
Total Marketing and Overheads
£76,239.61
£76,239.61
£76,239.61
Net Profit
£42,960.39
£66,800.39
£19,120.39
118 118
year two Base
+ 20%
- 20%
Revenue
£358,560.00
£430,272.00
£286,848.00
Cost of Sales
£120,800.00
£144,960.00
£96,640.00
Gross Profit
£237,760.00
£285,312.00
£190,208.00
Total Marketing and Overheads
£88,459.75
£88,459.75
£88,459.75
Net Profit
£149,300.25
£196,852.25
£101,748.25
year three Base
+ 20%
- 20%
Revenue
£600,660.00
£720,792.00
£600,660.00
Cost of Sales
£202,000.00
£242,400.00
£202,000.00
Gross Profit
£398,660.00
£478,392.00
£398,660.00
Total Marketing and Overheads
£127,577.95
£127,577.95
£127,577.95
Net Profit
£271,082.05
£350,814.05
£191,350.05
119 119
cash flow forecast Within the Cash Flow Forecast the closing cash without investment was assessed to fully determine the right amount of investment needed. July 2021 is the lowest cumulative figure and hence the worst month for the company, as a result this figure helped to decide the cash injection needed, which is £30,000. With investment Agree to Disagree remains with positive closing cash each month which is extremely positive. There is a big jump from November to December figures where sales rose over the Christmas period. At this point, the company can begin to pay back investors, starting with the Start Up Loan amount of £15,000. Year Two and Three Cash Flow Forecasts (appendix x) present how Agree to Disagree will be in an incredibly positive position with very strong closing cash figures at the end of the years. This success is supported by the YOY growth as the previous year’s cash provides an initial push at the beginning of each year. Full cash flow tables for all three years can be found in appendix 26.
May
Jun
Jul
Aug
Sep
Oct
Cash Injection
£30,000.00
£0.00
£0.00
£0.00
£0.00
£0.00
Gross Profit
£0.00
£1,516.00
£3,893.60
£5,484.00
£7,686.00
£9,420.00
Marketing and Overheads
£18,212.22
£9,851.50
£4,541.00
£4,621.10
£4,541.00
£5,245.09
Net Profit
-£18,212.22
-£8,335.50
-£647.40
£862.90
£3,145.00
£4,174.91
Closing Cash With No Investment
-£18,212.22
-£26,547.72
-£27,195.12 -£26,332.22
-£23,187.22
-£19,012.31
Closing Cash With Investment
£11,787.78
£3,452.28
£2,804.88
£6,812.78
£10,987.69
120
£3,667.78
Nov
Dec
Jan
Feb
Mar
April
Total
£0.00
£0.00
£0.00
£0.00
£0.00
£0.00
£30,000.00
£12,154.00
£27,792.00
£11,170.00
£12,366.80 £13,404.00
£14,313.60
£119,200.00
£5,206.50
£5,697.00
£4,541.00
£4,621.10
£4,541.00
£4,621.10
£76,239.61
£6,947.50
£22,095.00
£6,629.00
£7,745.70
£8,863.00
£9,692.50
£42,960.39
-£12,064.81
£10,030.19
£16,659.19
£24,404.89 £33,267.89
£42,960.39
£42,960.39
£17,935.19
£40,030.19
£46,659.19
£54,404.89 £63,267.89
£72,960.39
£72,960.39
121
122 122
CHAPTER TWELVE
BUSINESS OPERATIONS AND LOGISTICS 123 123
IMPLEMENTATION TIMELINE The implementation timeline outlines the activities to be undertaken prior to launching Agree to Disagree, with 12 months being needed from product creation to launch in 2021. The R&D of the product and initial manufacturing costs will come from personal investment being put into the company. These costs have been included in the start-up costs within the finances. Beginning of Research and Development: July 2020 Launch Date: June 2021
124
Design Product Creation Packaging Design Concept Testing with consumers Changes made from concept testing Mockup of product created Sign off on final product Manufacturing Research and find materials Find a manufacturer that meets the standards Manufacturer creates a batch copy of the product to test quality Finalise and sign contracts Finding Funding Contact Start up Loans to apply for the investment Ask friends and family for their investment Create a Kickstarter page and begin gaining the investment Have all investments secured and ready Marketing Agree marketing budget Website development - set breif, requirements and costs Website developed and created Creation of initial launch social meida content and plan future content Create the social channels Set up email database Begin posting content on social media Purchase materials for then create the first podcasts Upload launch podcast and promote on socials Begin emailing consumers updates on the launch Begin contacting infleuncers to send product Send out product to infleuncers Launch event - create breif and execute all detials ready for launch Launch event
125
Jun 21
May 21
Apr 21
Mar 21
Feb 21
Jan 21
Dec 20
Nov 20
Oct 20
Sep 20
Aug 20
Jul 20
Critical Path
KEY ROLES AND RESPONSIBILITES The office will be located in Nottingham and is a shared office space among other companies. This is the ideal office type for a small start-up as a small amount of space is needed for the three staff members and allows easy growth of the team through the small payment structure of a fee per month per person.
Role
Tasks
Skills and Experience Needed
CEO
• • •
Financial Management Customer Service Oversight General Management of business and staff
• • • •
Business management Customer interaction Financial experience Team leader
Marketing Manager
• • • •
Social media organisation Email marketing Podcast creation and promoting Influencer outreach and communication Overview of website visuals and overall look In store demonstration organisation Event management
• • •
Social media experience SEO experience Visual and Audio editing skills for podcast and any video content PR experience and excellent communication skills Events creation skills
Communication with retailers (Amazon, John Lewis, Smyths, Sainsbury’s) Outreach of new sales opportunities Control of website sales and distribution through Amazon and Tamazi.
•
• • • Sales Manager
• • •
Marketing Interns
•
• • • •
• •
• •
Interns will be used after the • launch to help young people gain valuable experience while they can provide their fresh ideas to the brand and help with the workload. Social media captions and posting. Event organisation creation of ideas for podcasts Influencer outreach
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Previous sales experience with large retailers Good communication skills Strong understanding of financials
University students preferred but any experience level.
PERFORMANCE MEASURES (KPIS) Objective
KPI
Strategic Objectives To be successfully sold on Amazon • and three major bricks-and-mortar retailers within the first year of trading.
Measured by the sales within the retailers. The game is successful once 1000 units have been sold within external retailers. Once this benchmark has been hit the brand has a backbone of sales to support the drive in sales.
To successfully gain initial capital of £30,000 before trading begins for the first year.
•
Successful once the capital is liquid and can be invested into the business, this should be accomplished before April the beginning of 2021.
To have sold 12,000 units by the end of year one.
•
At the end of Year One all the units sold across the annum will be collated and counted.
To generate strong brand awareness of Agree to Disagree amongst the target audience by achieving 6,000 followers on Instagram by the end of year one.
•
At the end of year one, the follower count on Instagram will be assessed.
To drive traffic to the website, gaining an average view rate of 1,000 views a month, by the end of year one.
•
Using Google Analytics, the traffic to the website can be assessed. This will be used to measure the website success continuously through the year as well as at the end of the year to collate the monthly traffic.
To successfully hold the launch event by gaining a daily footfall of 100 people per day.
•
There will be a sign in system for the event, whereby a member of staff will gain the email of each person entering the event each day.
Communication Objectives
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RISK ASSESMENT Risk
Threat Level
Likelihood
Potential Impact
Prevention
Funding cannot be secured.
Low/Medium
Low
Absence of funding would mean Agree to Disagree would potentially not have enough cash within the business to successfully continue.
Agree to Disagree can lessen this risk by creating an inviting proposition and utilising multiple funding avenues to grow the collective funding needed.
Threat of similar entrants into the competitive market.
Low
Low
Similar entrants have the potential to hinder the brands USP and differentiation, potentially lowering consumer desire.
The risk will be lessened by ensuring the product is copyrighted and protected against plagiarism or similar ideas.
Predicted revenue may not be met.
Medium/High
Medium
This could prevent Agree to Disagree from developing the brand further as they wouldn’t have the funds to do this.
By closely following the marketing strategy and communication plan, the brand should be able to meet the revenue needs and generate the sales. Additionally, the sensitivity analysis shows how even in the predicted sales are not met, the brand would still remain in profit and have their costs covered.
Delays to new product development.
Low
Medium
This may mean the projected sales from Year Three are not met as the sales in that year are driven by the release of the expansion. Its low risk as the product can be released at a later date without much implications.
It may be that external forces result in the delay of new expansions, however there is low risk to this, and it can be prevented by continuing to develop the product throughout the second year to get it ready for release in Year Three.
Low/Medium Risk of staff illness/being unable to work.
High
This may mean, as there is a single staff member for each area of activity (sales and marketing), that some activities are not completed on time or have to be rushed.
This is highly likely to occur as it is natural that staff members get sick. The risk can be lessened by ensuring communication among the team is constant and tasks can easily be picked up by another team ember for a day if necessary.
Low footfall to events.
Medium
As the brand is a start-up and awareness is low, people may be less inclined to enter the event and engage with the brand through the event.
By ensuring the decorations are inviting and colourful, passers-by should be interested to come into the event. Additionally, by having a mix of passers-by and invited attendees there should be less pressure on the footfall of the event.
Low
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Not securing distribution through external retailers.
Medium/High
Unexpected costs Medium
High
This would have a significant impact to the company sales as the external retailers are the main source of revenue for the brand.
A thorough understanding of the stockists has been created and their current products have been assessed, presenting the strong potential for Agree to Disagree to be stocked in these retailers based on their already similar products and the strong USP of the brand. By forming a relationship with the retailers, Agree to Disagree should stock the product in their stores.
High
The finances have all be calculated using the expected costs of the business for overheads and marketing. However, it is highly likely there would be unexpected costs occur that need to be paid. These unexpected costs would affect the finances of the business, but it depends on the size of the cost on the impact it has.
Small costs can easily be dealt with using the cash within the company. Larger costs, to a big extent, can also be covered by the cash within the company as the Cash Flow Forecast presents the active cash available for use. Additionally, a ÂŁ300 fund has been added to the start-up costs, ready to cover any small immediate costs within the first year.
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CHAPTER thirteen
the future and conclusion 131 131
future growth In order to reach its full potential in the following years, Agree to Disagree should focus on their growth strategy. In the closer years, more product expansions will be aimed to be released in order to maintain consumer interest on the brand and continue to drive sales. Additionally, Agree to Disagree could utilise some of the growth strategies
presented in the Ansoff’s Matrix to remain relevant and push the brand further while maintaining the original brand values. By potentially expanding the company by using these avenues, would allow the brand to not become stagnate and keep progressing, gaining new consumers and raising consumer interest as it does so.
ansoff matrix Market penetration (existing product, existing market)
Product development (new product, existing market)
New product expansions every other year, to ensure the topics remain up to date and relevant. Invites customers to repurchase the game with the new expansions and then allows more product offering for the consumers.
Within the game market, Agree to Disagree could offer a chat service with their consumers that allows conversations to be had if there is no one available. It creates a digital option for consumers to play the game with others online of they do not have anyone to play with at home. It aims to connect consumers to each other and the brand.
Market development (existing product, new market)
Diversification (new product, new market)
Agree to Disagree could take their existing game and create bonding events for schools/universities/ workplaces, whereby businesses pay the brand to hold team building events.
In the future Agree to Disagree could consider releasing a new product into a new market. an example of this is a self-help book that would help readers connect better to each other and become more confident in stating their opinions to each other.
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conclusion To conclude, the report has presented a viable business proposition that fulfilled the consumer need for better communication opportunities for ‘taboo’ topics and a brand that offered a safe space for conversation. Agree to Disagree has successfully proposed to meet this need and providing the brand follows the implementation strategy within this report, will effectively enter the market and grow to be a recognised game within said market. By offering more than just a game, but a meaningful experience for friends and families, Agree to Disagree is pushing the importance of talking‌whether you like it or not.
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