Section 1 & 2
Brief background and introduction to your product/innovation please include image/figure or sketch of your product if you feel it is necessary to describe the innovation
Most of this information is already with you (This information is there in A1 so need not to be very descriptive, be short and to the point)
Section 3 &4 – Market and customers, Market Size and Trend
Specify total market potential and customers, show the market trend and extrapolate the future market
Section 5 Target Market & Customer
Describe the geographical region to start the business, justify your selection with statistics and data. Expansion potential & strategies. Is this market expanding/growing?
Section 5/6 /7 Competitive Analysis and Estimated Market share
Describe the competitive environment. Who else is in the market place and what are their strengths and weaknesses compared to yours? Include at least 2 analysis (SWOT, PEST, 5 force Analysis) Describe your distribution strategy.
Section 8 Finance forecast (Profit & Loss)
What are your estimated sales volumes, profit margins, overhead expenses etc
Section 9 & 10 Finance Forecast (Cash Flow)
Identify capital and other expenditure items required to implement the idea and estimate the timing/milestones. (Table only)
Product A specifications
‘Product A’ has been on the market since the year 2015, but it was of the lower specification. The screen size was 5.1 inches with a lower resolution, and an 8-megapixel (MP) camera around the back with 5- megapixel (MP) front camera and an Android 5 version lollipop model was the operating system (OS) of the phone. It had a removable battery too with 2,000aMp. Its innovation has been upped to a rear 12MP camera, Dual Aperture switches to the F2.4 mode in daylight to take sharp and beautiful images and in a low-light predicament, it goes to F1.5 mode to let more light in for brighter and more simple night time photos. Again, it is IP67 water and dust resistance, and with a fingerprint reader and face scanner for security protection and lastly, it has an inbuilt battery of 3,000aMp. The images below show the Product in its latest innovation stage.
Market size is the number of persons or individuals in a particular market who are potential or imminent buyers and sellers of a product in the market environment (Atuahene?Gima 2015, p. 275). Understanding market measurement helps differentiate between two levels: the addressable market, which is the entire revenue opportunity for the merchandise and the current or possible market, which is the share of the addressable market for which can instantly realistically compete and competitor (Cooper and Kleinschmidt 2013, p. 50). The product has a more significant market size since it is in higher demand due to increased and advanced technology. The market size of ‘Product A’ ranges from local to international markets. The product will fit in the global market since it has world-wide features and specifications that enter diplomatically. Then, the business potential is the predicted apex or supreme entire sales revenue of all suppliers of a commodity in a market through a specific time. ‘Product A’ has a larger market potential since research states that people demand high featured smartphones than those in the current market. A market trend is a known tendency of financial markets to move in a particular line of direction over time (Dobruszkes et al. 2017, p.50). These trends are classified as temporal for long time frames, primary for common time frames, and unimportant for short time frames. ‘Product A’ has an upper and increased market trend since it is the latest smartphone with higher specifications in the market environment. The Investigation in the current market, there are smartphones, tablets, and even watches that allow phone calls were made but of poor camera quality and android version ranging from 2-4 Android version. The changes in ‘Product A’ makes the market trend to fit in well in the competitive environment with ease and is an excellently (Nguyen et al. 2017, p.225). The figure blows an extrapolated future market for ‘Product A.’
Market size and potential of Product A
Target Market involves splitting a market into sections and then centralising or constricting marketing efforts on one or a few key sectors, consisting of customers whose needs and desires match a given product (Nguyen et al. 2017, p.225) ‘Product A’ marks a wide span of customers varying from normal day to day devices users to standard industrial users. The target age group of customers then range from teenagers toward persons with 50years or even older, as long as the person has the aptitude and capacity to buy and handle what ‘Product A’ has to offer in the market. It has a global geographical target (Camilleri 2018, p.85). That means that has no specific area of operation, but the operation ranges from underdeveloped countries to develop and from more technologically advanced countries to less technologically developed countries.Due to its higher battery retaining power and life of 3000aMp, this shall help those in underdeveloped countries where there are electricity problems and shortage to have more advantage over others who possess other products and smartphones in the current market. This geographical set of ‘Product A’ has a maximum expansion and growth since it targets a large area of a market audience (Cooper and Kleinschmidt 2013, p. 50). The table below shows a sample of geographical area, and the target population within which ‘Product A’ market will run.
A competitive environment can be termed as the progressive visible mode in which firm rivals and purposes. It means that the more the sellers of related merchandise, the more aggressive the setting in which it competes becomes (Camilleri 2018, p.85). ‘Product A’ has few well know alternatives and rivals in the competitive market. They include products like IOS- iPhone, Symbian (from Nokia), Windows and BlackBerry. From the SWOT analysis angle, Product A has several strengths, weaknesses, opportunities and threats. Its strengths are that it has a significant market share, low-cost production, hardware combination with various open fount OS and software, high industrial patterns and also customer loyalty (Caselli and Gatt 2017, p. 60).
Characteristics of a ‘product A’ that places it at a disadvantage relative to others is that it lacks its OS/software, it may be considered as not user-friendly at some points, powerful competitors (E.g. Apple and windows) and lastly it has no focus on one core competency product. Opportunities it has is that there is increasing smartphone market today, growing interest for quality requisition of top and quality android features, an evolution of tablets and smartphone business and to finish with, ‘Product A’ has a gaining patent through acquisitions. (Rakha et al. 2018, p.232). Then to finish with elements in the environment that could cause it troubles- Threat, it has a Slow market in developed countries, declining margins in hardware production, increasing competition from other smartphone companies and rapid change in technology (Keller 2017, p. 65).
Target market of Product A
Then from the PEST analysis to start with the political angle, ‘Product A’ faces numerous patent claim upshots in the smartphone manufacturers and also defend its intelligent traits by accusing opponents and claiming violation rights on grants purpose and plans. Then from the economic side, Android is the top dealer of smartphones, and in social, it has an ageing demographic gender for business or personal usage and has a social lifestyle (Dobruszkes et al. 2017, p.50). In technological approach, it has world-class, sarcastic-edge technology beyond manufacturers, including IT, semiconductor, and telecommunications. It has an HD sensitive touchscreen, advanced pixel technology ISO cell in premium mobile devices brings clearer and higher-quality pictures and endless eco-beneficial, near-generation technology perfection and effectiveness in light origins in the LED enterprise. The diagram below shows SWOT and PEST diagrams.
A profit and loss calculation is used to prognosticate profit and losses over the coming financial year. A good P&L assures that there shall be sufficient capital proceeding into better the costs of rendering the goods and aids leading to earning a substantial profit. In tough times, P&L plays the critical part in proving what sort of program needs to revert to breakeven so that the market can persist until better times to come (Rakha et al. 2018, p.232). Starting with overhead expenses as an all ongoing business expense, ‘Product A’ has an estimated overhead of USD250, 000,000 and an estimate sales volumes, which is the quantity or number of goods sold or services sold in a specified period, that ranges from 26% to 30%. The profit margin is of about 20% to 22%. The diagram below shows the financial forecast profit and loss for ‘Product A’.
The financial forecast is significant because if a firm roll out of resources and is not suitable to achieve and acquire current money, it will shift to brokenness. It is the backbone of all businesses, particularly start-ups and small initiatives (Dobruszkes et al. 2017, p.50). As a result, it is essential that management forecast (predict) what is going to happen to cash flow to make sure the business has sufficient funds to survive. Cash flow of ‘Product A’ is as shown below diagrammatically.
The limit at which sum of fixed and mutable values of a business becomes equal to its total revenue is known as break-even point (BEP). At this point, an organisation neither earns any profit nor suffers any loss (Dobruszkes et al. 2017, p.50). Break-even boundary is therefore also known as no-profit, no-loss point or zero value point. In the below figure, it shows a shortened break-even of ‘Product A.’
Competitive environment of Product A
‘Product A’ has all specifications to fit in the market with ease. It enabled and supported by its distinct and unique features and the modernity in it. It also has a wider market target and a global acceptance supported by the increased technology rate today. Then, for a product to achieve and maintain its standards in the current competitive market, it needs to reinvent existing features and specifications and deploy fresh and modern and innovative product pattern to achieve competitive and rivalry advantages and financial sustainability in the market environment. Business standards canvases are helpful tools to figure planning thought processes, building the organisational capacity of a newly innovated product, and guiding consummation of changes in institutional product business model. The innovation of ‘Product A’ helps in creating its market demand a lifespan in the market industry. So, the newer the product’s innovation and improvement, the more the demand and life cycle in the market industry just like as in ‘Product A’.
Then, for innovation in the market, before it is performed, it is advisable to pass it through several steps and processes. The measures include checking its market demand and setting a well geographical range under which the supply shall range from and over. The target population is also another crucial factor where the customers and consumers of that given product must be analysed and set in accordance to their needs, demands and desire for what they have been yarning for in the current market.
Financial loses and profits should also be put into considerations since for a new product in the market and business industry to pick and reach the cliff, it must undergo various constraints that may not be predicted hence having a plan at hand. Cash flow should also be deposited so as in case of emergencies, the innovation may be unleashed and saved from collapse.
Atuahene?Gima, K., 2015. An exploratory analysis of the impact of market orientation on new product performance. Journal of product innovation management, 12(4), pp.275-293.
Camilleri, M.A., 2018. Integrated Marketing Communications. In Travel Marketing, Tourism Economics and the Airline Product (pp. 85-103). Springer, Cham.
Caselli and Gatt S 2017. Structured Finance: Techniques, Products and Market. Springer.
Cooper, R.G. and Kleinschmidt, E.J., 2013 Bench marking the firm's critical success factors in new product development. Journal of product innovation management, 12(5), pp.374-391.
Dobruszkes, F., Givoni, M. and Vowles, T., 2017. Hello major airports, goodbye regional airports? Recent changes in European and US low-cost airline airport choice. Journal of Air Transport Management, 59, pp.50-62.
Griffin, A., 2007. PDMA research on new product development practices: Updating trends and benchmarking best practices. Journal of product innovation management, 14(6), pp.429458.
Keller, K.L., 2017. Managing the growth tradeoff: Challenges and opportunities in luxury branding. In Advances in Luxury Brand Management (pp. 179-198). Palgrave Macmillan, Cham.
Lancaster, G. and Massingham, L., 2017. Markets and customers: market boundaries; target marketing. In Essentials of Marketing Management (pp. 70-101). Routledge.
Nguyen, T.Q., Ebnesajjad, C., Cole, S.R. and Stuart, E.A., 2017. Sensitivity analysis for an unobserved moderator in RCT-to-target-population generalization of treatment effects. The Annals of Applied Statistics, 11(1), pp.225-247.
Rakha, T., Moss, T. and Shin, D., 2018. A Decade Analysis of Residential LEED Buildings Market Share in the United States: Trends for Transitioning Sustainable Societies. Sustainable Cities and Society.
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