Bringing a new product to market – Case Study Example

Marketing- Bringing a New Product to Market Solution for Question 2: Every new product that enters the market mostly possesses the first mover advantage, which is highly crucial during the introductory period. It was the same in John DiGate’s case with his product “Bear Claw,” which was positively acclaimed during the initial period of the product’s launch and he also received the “Retailers Choice Award” (Winter 43). But later, due to the occurrence of “mounting debts and disappointing sales” he started to explore different distribution options in order to overcome this situation (43). His product mainly serves the domestic purpose, so initially he needs to work towards popularizing his product to the common public. Only after he figures how to do this can he go for strategic partnership agreements. In the case of John, it is seen that he always tries to create agreements with various strategic partners. Some of the strategies that can be used to improve his sales are as follows: 1. Circulate free samples with attached feedback forms to the main users like electricians and plumbers belonging to one specific region. Lucky draws can also be held for the filled up feedback forms, which would be a great way to attract more people. Feedback forms can be designed in such a way to improve the product and package qualities as well as explore the price/usage constraints. 2. Offer prices for next purchases for those who bought items during selling shows of hardware chains like “Orgill and House Hanson” (46). He needs to communicate with the clients frequently and announce various schemes for them to in order to encourage them to make further purchases. Existing customers are valuable for the firm’s goodwill as well as progress. 3. Like customers, retailers are also very important in improving sales. John’s frim, the “DiGate Design,” can generate a larger amount of profit by charging “$1.30/ pack” (47). This enables them to spend some amount for retailers in terms of their commission, in order to push their products in the public to ultimately raise sales. 4. The firm can concentrate first in smaller and specific geographic regions, after that they can move next, which enable product publicity with lesser cost. Solution for Question 3: Total costs incurred on this project, as per the information provided in the case study, are listed below: Particulars Time Period Amount in $ Delta Clip - Production machine Apr 2000 20000 Delta Clip – Bagging machine Apr 2000 16000 Bear Claw – Production machine Apr 2001 35000 Additional cost for each clip size Apr 2001 500 Warehouse rent (10 years * 12 months * 150/month) From Dec 2002 18000 Cost for Orgill’s Selling show in Atlanta Sep 2003 6000 Cost for Orgill’s Selling show in Florida May 2004 7000 Cost for Orgill’s Selling show in Baltimore Sep 2004 3000 Cost for House Hanson’s Selling show in Kansas City Oct 2004 3000 Cost for Air QVC drywall repair kits project Aug 2004 20000 Total cost incurred on this project 128500 However, it is seen that these costs are not incurred on the product. Initial investment like cost of production and bagging machine as well as warehouse rent are included in the product cost. But cost for selling shows are not directly involved in manufacturing and it is only treated as marketing expense. Cost for Air QVC drywall repair kits include multiple items including exported goods. So the overall cost for QVC drywall repair kit should not be included on the product. Works Cited Winter, Jerrold A. “The ‘Bear Claw’ Drywall Repair Clips: Bringing a New Product to Market.” Journal of Case Studies- September/October 2011. Vol. 7, No. 5. Hood College, USA. Web. 8 Apr 2013.