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Executive Summary For most people, how one wakes up defines his or her day. Sleeping in too much and getting a late start on the day sets a bad tone. Too often have we all missed tests, appointments, classes, presentations, and more just because we slept through our alarm or kept ‘snoozing’ through the morning. Well with Clocky, those days are no more. Clocky is the walking alarm clock made for those who have a tough time waking up in the morning or for those who just want to add some excitement to their morning routine.
Clocky starts off as a simple alarm clock resting on one’s bedside and goes off at whatever time the user sets it to. What differentiates Clocky from those other alarm clocks on the market is that after you hit the snooze button (which you do of course), Clocky runs away and moves around your room until your snooze time is up, at which point it begins loudly ringing and flashing its lights. This time you can’t just reach over and shut it off, because it’s not there. Rather you, or the user, must get up, find the clock, and shut it off yourself, thus leaving you up and awake.
And to add to the pressure of getting up and out of bed, Clocky’s random and varying ring gets louder and louder the longer you wait to shut it off. Clocky is a new and unique product designed for younger people with the energy and willingness to get up in the morning and find their alarm clock. It is intended for those heavy sleepers who just can’t seem to wake up, and keep hitting the snooze button on their clocks, as well as for kids or those just looking for a fun way to start their day.
Clocky features a strong, durable casing and heavy duty shock absorbers and wheels that allow it to fall off any desk or bedside table with no damage, and roll around on any surface with no problem. Its unique microprocessor insures Clocky moves randomly so you can never predict where it will be, and helps Clocky navigate around obstacles. We aim to have Clocky helping millions wake up every morning, first in the Greater Toronto Area, then all of Canada and beyond, and to develop a well known, well liked, and quality product.
Our primary short-term objectives are to, first build awareness of Clocky around the GTA, and second to reach a 3. 5% share of the alarm clock market in the GTA within our first year of operations. We plan to achieve these objectives through the innovative design of our product, an aggressive pricing strategy, direct as well as indirect product placing, and well designed promotional events. The Three C’s Consumer Toronto is the financial and commercial center of Canada.
It is also the host city to several major universities including the University of Toronto, York University and Ryerson University. Therefore, the residents in Toronto are mainly employed people and students who need to wake up on time in the morning. Employed people have considerable amount of disposable income while students are poorer and more price sensitive. Our main customers are heavy users of alarm clocks, i. e. heavy sleepers. This commonly includes students, young working adults, shift workers and travelers. Competition
The main competitors of our product are conventional alarm clocks and digital devices such as MP3 players, cell phones, and computers equipped with alarm functions. Although the competition in the alarm clock market is substantial, our product design and concept is new in Canada. Barriers to entry are relatively low, despite patents, but start-up (R&D) costs are quite substantial and it would take competitors some time to design and develop similar products. Company The product has been launched with our partner CASIO and will feature the CASIO brand name alongside Clocky Inc.
Relying on the advanced R & D department of CASIO and the mature technology of CASIO clocks, we intend to design and assemble a walking alarm clock, which is solid, safe, user-friendly, and cool. Situation Analysis (SWOT) Strengths Clocky is a unique and easily identifiable product. Partnering with CASIO, a world leader in small consumer electronics and timepieces, gives us increased know-how in clock-making, thus lowering our costs. This strategic partnership also gives us the strong CASIO brand, one that resonates with consumers as a brand known for quality, durability, and innovation, attracting customers.
Clocky’s robust structure and advanced casing designed to prevent damage result in a durable, high-quality, and long-lasting alarm clock that consumers will surely be satisfied with and use for many years. Our focus on detail and providing additional features such as the flashing lights, ascending volume alarm, and early low battery indicators on the advanced LCD screen, make for a product that consumers realize is leagues above most conventional alarm clocks, further increasing satisfaction.
These features are also designed to make it easier to find Clocky in the dark and more practical for users waking up early in the morning and do not have time to spend looking for the clock. Weaknesses The primary weaknesses facing the development of Clocky lie on the cost side. Start-up costs will likely be high, primarily due to substantial research and development costs associated with developing Clocky’s unique microprocessor and durable casing. We also expect higher production cost than the conventional alarm clocks due to the addition of the microprocessor, wheels, and stronger casing.
These increased costs make pricing somewhat difficult as it is important we do not charge too much for Clocky, but ensure profitability and substantial growth. Another potential problem may be that the hassle of searching for, and trying to disable, Clocky (often in the dark) may cause frustration and even minor injury to the user. Though we have always been, and still are, committed to consumer satisfaction and safety when designing Clocky, these problems are still likely to persist regardless of design due to the very nature of the product.
Opportunities Clocky offers many great opportunities for profitability in its present state as well as others in expanding the brand and developing other products. It’s fun and unique concept invites the possibility of designing toys or other gadgets based on Clocky or its underlying technology. Due to the open nature of Clocky and the ability to modify its programming through adjustments in the microprocessor, once initially developed, the product could be easily modified for other target markets.
We are particularly interested in the possibility of designing a modified model for those unwilling, or physically unable, to chase a clock around every morning. Patent protection as well as the long development timetable associated with designing such a product could prevent competitors from entering the market with similar products for some time to come, providing us with the opportunity to grow and expand with little competition. After our product has succeed in Toronto, it can be sold to the GTA area and other major cities in Canada, further increasing our revenue and profit.
Threats As Clocky does hold some potential for causing minor personal injury and frustration to users, particularly when searching for it in the dark, we may be exposed to potential legal suits as well as a bad image. Focusing on excellent customer service and placing proper warnings should help limit the potential impact of suits or bad PR. Also, though there is a large segment that would likely appreciate, and benefit from Clocky greatly, the concept may not be as widely accepted.
A large portion of the alarm-clock market, elderly working adults, may not be as open to the idea of chasing a clock around their bedrooms, or may even be unable to do so. Also, despite patent protection and high start-up costs, there are low barriers to entry and many competitors in the alarm clock market, so once launched there is a potential that there could be a great deal of competition limiting company growth and profitability. Segmenting, Targeting, and Positioning Segmenting In segmenting the market for alarm clocks, we need to focus primarily on behavioral as well as some demographic factors.
Looking at behaviour, the alarm clock market can be segmented based on people’s usage of alarm clocks to wake up. Some people are easily woken and will wake up by any noise; they would be considered light users of alarm clocks. Others who have a hard time waking up and typically need very loud and continuous stimulation before waking up; these people would be considered heavy users of alarm clocks. Demographically, the market for alarm clocks can be divided into segments based on age.
While difficulty waking up typically differs within all age groups, very young children and most working adults typically wake up easily, while teenagers and young adults typically have a harder time waking up (this is usually based on the time they sleep and how active their days are). This coincides with the behavioral segments of heavy and light users of alarm clocks. We also look at age as it relates to technology and one’s energy. Younger people are generally more willing to try new technology and they have more energy. Older people are generally slower to adopt new technology, and typically have less energy in the morning.
Targeting As Clocky is designed for people who have a hard time waking up in the morning, it should be targeted to those who are considered heavy users of alarm clocks and frequently depend on them to wake up. Clocky’s unique concept of running around and hiding also require it be targeted to those who have the energy and physical ability to chase a clock in the morning, as well as the willingness to switch use new technology. As such it should be target to younger users (kids, teenagers, young adults). Its design and ‘fun’ concept also make it especially appealing to younger kids as they wake up for school.
Clocky should be targeted to heavy users of alarm clocks between the ages of 10-35. Age range of 10-35 is 33. 2% of the total population , representing a huge pool of potential buyers. Positioning In Clocky, we want to give potential users an image of a useful, reliable, and innovative product for everyday use. Clocky will be positioned as more than just a simple alarm clock. It has a cool design and is designed to take the boring, and often frustrating aspect of waking up in the morning to a new level. Clocky makes it so that even the heaviest of sleepers don’t oversleep and wake up late.
Marketing Objectives Our marketing objectives can be classified primarily between product awareness and market expansion. We aim to tackle these objectives in two corresponding stages, the first focusing on product introduction and the second focusing on market growth and expansion. Product Awareness Our objective in this regard is to introduce Clocky in our local market, the Greater Toronto Area (GTA), with the goal of having the majority of the Torontonians aware of Clocky within the first three months. The primary goal of this awareness raising is to build up our company’s image.
We are aiming for, and expect, sale of approximately 3000 units by the end of this first three month period. Within our first full year of operations we aim to claim a 3. 5% share of the alarm clock market in the GTA. Market Expansion In the long term, once our product is well known to the majority of households in the GTA, we aim to gradually expand our brand and sell to all of Canada and beyond. Our aim is to continue focusing on promotion and quality as we work to make necessary adjustments to meet changing consumer and market conditions.
Marketing Strategies Product Our strategy is to produce Clocky, a walking alarm clock, that can effectively force the owner wake up. The most important feature of our product is based on the principle of “hide and seek”. It is outfitted with wheels, allowing it to move around in order to force the owner get off the bed in an attempt to find it and switch it off. Our product is designed to ensure solidity and safety. Customization on color mix is allowed to satisfy customer’s personal need. Our generous return and repair policy will encourage more purchases.
Besides all the features related to the actual product, we will also emphasize customer service to create positive customer experiences and build our reputation. All these effort on product designing and related services will make our product appealing to customers. Pricing The regular price for our product should be set at a higher level than average clock because Clocky delivers higher value to customers and bears a higher production cost. Nevertheless, at the beginning few months after first launch of our product, we decide to use price penetration strategy to boost sale and gain awareness due to two reasons.
First, our product is new to the market, so we need to set the price at an attractive level to raise enough awareness and encourage purchase of our product. Secondly, the clock industry is very competitive. A lot of people are indifferent with different clocks. Although Clocky delivers a higher value, people may be still reluctant to pay a premium price for it when the value of Clocky is not confirmed by others at the initial time. Therefore, deliberately setting Clocky at a discounted price level similar to the regular price for average clocks is a reasonable choice, because people are willing to pay “same for more”.
This price will give us a competitive edge over our competitors. After our product gain enough awareness, we will sell the product at regular price again to cover our cost and make a profit. While setting price, we will also implement second-degree price discrimination to maximize our profit. Placement As we want to implement integrated and consistent marketing strategy for all distribution channels, we want to avoid channel complexity and minimize the number of channel level. Therefore, we are selling our products through direct marketing channel and indirect marketing channel containing only one intermediary level.
This strategy is reasonable, because as we are selling a new premium product, we want to keep the maximum control on marketing strategy to create a consistent positive brand image and reputation. As we will place our manufacturing factory in developing country to reduce production cost, we always need to carry an adequate level of inventory in warehouse here in Canada to satisfy changing demand of customers. The level of inventory and the composition of inventory should be kept at a reasonable level to reduce cost. Promotion
To achieve our objective of boosting sale and raising awareness, our emphasis is place on advertising and sales promotion. Advertising on different medias is used to inform people and raise people’s awareness of our products. Sales promotion is implemented to attract people to buy our product. As we are in a competitive industry, our advertising should focus on emphasizing the value our product could bring to customers. As our product is innovative and we are targeting at relative young people, we should make our advertising interesting and creative to attract customers.
Also, it is important to notice that favorable word of mouth can be great help to the spread of our brand image. Marketing Tactics Product The alarm initially operates as a standard alarm clock, ringing at the user set time daily. Where Clocky differs from all other alarm clocks is that once the snooze button is pressed (as people often do in the morning to delay waking), Clocky runs off and moves randomly around the user’s room until the snooze time has expired. Once the time has run up, Clocky rings and flashes once more to wake up the user.
Now the user is forced out of bed to search for the clock to disable the alarm, thus waking up. A unique and specialized microprocessor ensures that Clocky moves at random speeds and directions, and around obstacles. Large wheels and shock absorbers allow Clocky to roll about on practically all surfaces from thick carpeting to hardwood flooring. The wheels in conjunction with its rugged casing ensure Clocky remains undamaged from falling off a bedside table or desk, and allow it to roll along even when upside-down.
When Clocky is moving around, it beeps and flashes to prevent people from accidentally stepping on it and getting hurt. Clocky’s “hide and seek” function can be simply disabled allowing it to function as a normal, yet very cool looking, alarm clock as well. Clocky can be considered the perfect bedside pet that sleeps alongside you quietly during the night, with no mess, and wakes you up at the time you want. Key Features: ???Customizable snooze; setting snooze to zero makes Clocky run right away ???Guaranteed against breakage from falls up to 4 feet Moves randomly, on all surfaces, and navigates around obstacles ???Screen flashes in addition to alarm ringing for easy locating in the dark ???Alarm beeps randomly and volume increases to insure user wakes ???Clocky is small and portable (5. 25″ x 3. 5″ x 3. 5″), runs on AA batteries, great for travel ???One can disable “hide and seek” function for use as a normal alarm clock ???Early low battery warning displayed on screen ???Multiple colors and design prints to choose, can be custom engraved (online or phone only) Pricing We set our price based on both cost and demand.
The cost of our product can be obtained by considering the cost of regular clocks and the cost of incorporating the moving robot together. Market condition and demand should also be taken into consideration when we are setting price. As we are using market penetration strategy at the initial stage, we will charge a discounted price on the first 3,000 units sold, as these will be sold at promotional events. After that, we will have varying prices ranging from $34. 95 to $59. 95, depending on where, and by whom, the product is purchased.
Using second-degree price discrimination, discounts will also be given to large volume purchase. Detailed prices listed below: SegmentsPrice ($CAD) Regular Price$49. 95 Discounted price for first 3000 units and special offer$34. 95 Student Price (student ID required) and volume purchase$44. 95 Limited Edition$59. 95 All prices include free 1 year Warranty with option to purchase additional 3 year warranty for $4. 95 Custom Engraving (available online and over the phone only) costs an additional $0. 99 cents Placement
The direct marketing channels we are using include Clocky online store and Clocky booths in big malls. Through these two channels, we can have direct contacts with customers and ensure the quality of our services. The indirect channels we are using are selective distribution channels including big retailers such as Best Buy, Wal-Mart, The Bay, Staples, etc… By using only one intermediary distribution level, we largely extend the coverage of our distribution channels while still holding control over the marketing strategy of our products.
We will sign contracts with these retailers to ensure successful implementation of vertical marketing system. We manufacture our products in developing countries to minimize production cost. China is an optimal choice since it has complete infrastructure, cheap labor force and large number of components suppliers. As a result, we need warehouse in Toronto to store adequate level of inventory. Inventory should be kept at a high level initially to meet the demand of our products, since we have no past data on sale.
After several weeks, we can estimate demand of our products and various colors based on past sale volume and trend, gradually reducing our inventory to a adequate level. Promotion: Since our product is primarily targeted at young people in the GTA, we should advertising on the local medias including local TV channels (CP24) and local news paper (Toronto Star). Advertising on our own website and booths is also important to create our image of innovative product. “Chase it till you wake! ” would be a simple and humorous advertising message.
Demonstration of our product would be performed at our booths and promotional events. Sales promotion is implemented during the early stage. The first 3000 units will be sold as cents-off deals. It is a limited quantity offer to encourage people to try out our product, thus helping us to increase awareness through word of mouth. Also, limited time generous return policy (limited time three month return policy instead of regular one month) will definitely encourage people to try our product.
All these effort are made to raise awareness and encourage purchase of our product. (See Appendix A for sample website, Appendix B for sample poster advertisement and in-store display) Evaluation Procedure To evaluate the success of our plan and strategies we need to periodically, (i. e. monthly, quarterly, and annually) collect sales figures, calculate profit, measure our share of market, calculate percentage of returned items for refund / repair, and estimate the customers’ overall satisfaction.
When every measure is at its highest possible level except for the percentage of the returned/repaired items that should be close to none, then we have successfully achieved our goal. A steady increase in sales figures and profits are signs of overall success of business performance. To find out how our customers evaluate the quality of our product and service, we will design online and paper questionnaires with rewards for those customers who take the time to fill them out carefully.
We will use then and analyze the outcome of these surveys to find out how satisfied our customers are with Clocky and our services. Target sale and profit will be estimated at the beginning of every month. These targets are set to gradually meet our objective. By comparing targets against performance, we will be able to find and correct weakness in our business model. All these evaluation methods are used to ensure company’s quick response to unexpected situation.
We will do our best to adjust ourselves if necessary to meet our annual and long term objective To compare our performance with our goal we will use a database to store and keep track of cost of production, all sales figures, and number of repaired and refunded items for each market, group of customers and method of sales. Then with help of computer programs available in the market we analyze these figures and compare them with the relevant numbers estimated for each group at the time of starting the project. The less diverse the figures are the more realistic our estimates have been which indicates success.