Marketing Plan Essay
The prototypes have been put on graphic card reference boards for standard PC’s and distributed to PC Gaming Review sites, PC Gaming magazines and PC Game companies for testing/review purposes and the reception was extremely positive. Alongside with this the Gaming Review Sites and Magazines published their findings in their publications and the reception of the general public (through letters, blobs) has been extremely enthusiastic. The next step in the process is to bring the prototype to market (expected launch is SQ 201 5 and evaluate entry into new markets (mobile and High Performance Computing)
Mission Statement Great Gaming Graphics mission statement is as follows: “The best Gaming experience in the world. Period!!!!!!! ” The Product 36 has developed graphic chips for the PC gaming market. The graphic chips (lower end model 36100 and higher end model 36200) offer substantially higher frame rates per second with the maximum feature set enabled (Anti-Aliasing at maximum) than the competition. The experience for the video gamer is that games can run with live like graphic experience on large resolution screens (including K screens) without any stutter of the motion (at least GHz up to K resolution).
Consumer Product Classification Gaming Graphics Cards are shopping products.
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Target Market The target market for the 36 products are computer gamers (Males in the age roof 14-50 years old), PC/Notebook Memo’s (HP, Dell, Leno, SASS, MS’ etc. ) and Graphic Card Manufactures. The gaming market represents at least 100 MIM people globally, based on the best-selling computer games ever sold. The target audience for the product is split into three distinctive groups: The Casual Gamer The term “casual gamer” is often used for gamers who primarily play casual games, but can also refer to gamers who play less frequently than other gamers.
Casual gamers may play games designed for ease of gamely, or play more involved games in short sessions, or at a slower pace than hardcore gamers. The types of game that casual gamers play vary, and they are less likely own a dedicated video game console. The casual gamer represents approve. 80% of the gaming market. The casual gamer will upgrade his gaming experience from build-in graphics (at time of purchase of the PC/Laptop), if the price is low enough to Justify the upgrade. The price a casual gamer is willing to pay for a better gaming experience is up to $50.
Mainstream Gamer A mainstream gamer is a player Witt a wider range to interests than a casual gamer and is more likely to enthusiastically play different types of games, but without the mount of time spent and sense of competition of a hardcore gamer. The mainstream gamer enjoys games but may not finish every game they buy and doesn’t have time for long MOM (Massive Multilayer Online) quests. The mainstream gamer represents approve. 15% of the gaming market. The mainstream gamer will seek out the best bang for the buck regarding his/her gaming experience and is willing to spend up to $200 for a graphic card.
Hardcore Gamer A hardcore gamer is a player that spends the majority of his/her free time with gaming. The hardcore gamer is very competitive, often owns the latest high-end genealogy (High-End PC’s, Consoles, Multi-Monitor Setup, 7. 1 Sound System etc. ), are very technology save. “y’ and often seek out and participate in gaming communities. The hardcore gamer represents only about 5% of the gaming market, but a large part of the earnings for the gaming hardware producers, because the margin of the high- end products are substantially higher than in the other categories.
The hardcore gamer will seek out the best performing product, no matter what the price is. Some hardcore gamers install up to 4 graphic cards (with a total price of up to $3000 for he Graphic System alone) to have the best gaming experience possible (very high resolution across multiple screens and all graphic options enabled for the best experience) Competitive Situation Analysis Analysis of Competition using Porter’s 5 Forces Model Competitive Rivalry The discrete PC graphic card market generates approve. 6 billion revenue annually on a global scale. The two competitors in this market are MAD (Radon) and Nevada (Gofer) with a roughly equal market share of about 20% each. Even though Intel is considered to be the market leader in PC graphics, they only have CPU embedded repairs with low performance/features and are currently not considered a competitor. Invalid has recently released an upgraded product line (Mainstream to High-End), with performance increases of approve. 0% across the product line and power reduction of approve. 25% compared with the previous models. Pricing got slightly reduced within the classification of their products (-?$200 Mainstream, -?$300 Enthusiast, -?$600 High-End) to gain market share against its only competitor who hasn’t upgraded its product line yet. Invalid is still producing its upgraded product line in a NM process and is not going to 20/NM before the end of 2016.
G’s current prototype is already produced in NM and is slated to be on NM at IQ 12016, which gives it an even greater greater competitive advantage over Invalid, considering that smaller structures allow substantially faster performance of graphic chips while at the same time reducing power requirements. Mad’s current product line is still based on the three year old Graphics Core Next (GIN) design, which has been refined over the years but is clearly at its limit. Power consumption of MAD powered graphic cards is almost twice of Invalid’s and more than 4 times of the G retype. 6 NAS a clear advantage against boot competitors, considering that high-end prototype is currently 220% faster than either competitor, with a power use advantage of at least 50% which results in not only a lower power bill for the end consumer of the graphic card but as well reduced cost for cooling components. Additionally the low power requirements allow the use of smaller and cheaper power supplies, which is going to reduce the overall cost of a PC gaming machine even further.
One large advantage of the reduced power requirements is that the graphics hip can be used in the upcoming STEAM’S machines (small form factor PC gaming machines, which resemble video game consoles) without sacrifice to performance. Threat from New Entrants There is a potential that ARM (with Mali) and Qualm (Adrenal) redesign their current SoC (System on a Chip) products and license it to third parties to produce discreet graphic chips. Both companies offer their current products only in the mobile market (Phone/Tablets), which is high volume with a substantially lower margin per chip sold than the discreet PC graphic market.
Alongside with this, both impasses are in a very good position to drive power requirements even further down, considering their experience with the low power requirement of battery operated systems like phones and tablets. Threat from Buyers The following two potential issues arise from an end customer perspective. 1 . Competitive products catch up or exceed with g’s product performance at the same price point, which will lower the appeal for end-consumers to use the 36 product. 2.
A change in gaming habits to games that don’t have the high graphic power requirements and therefore curbing demand for the overall discreet graphic chip market. Threat from Suppliers Considering the initial lower volume of the product for production in a Semiconductor FAA (ATSC, Samsung etc. ) 36 might get bumped to a lower priority if larger customers of the FAA are asking for a larger part of the capacity, due to higher demand. There is a limited amount of FAA Capacity available and it is not easy to move to another FAA (ramp-up time approve. Month). Therefore the contracts with the Semiconductor FAA have to be structured in a way to have a guaranteed amount of product delivered (with penalties associated if not fulfilled) plus a contract clause to low ramp up of production by 10% on a monthly base. Once 36 is getting bigger, it might make sense to pursue a dual supplier strategy, with the advantage of not relying on a Single FAA to produce all graphic chips and the disadvantage alongside with this with not getting high enough volume discounts.
Threat from Substitutes One potential issue arising in the future is that ICP (Integrated Graphic Processing) units that are part of a CPU (Intel, MAD and Coco’s) are becoming powerful enough to play the most demanding games and therefore a dedicated Graphic Chip is not going to be required anymore. At this stage this is not a threat for the next 3 years (according to 5 year roadman of potential CPU/SoC providers), but could certainly change in the future.
It takes 2-3 years to develop a competitive product and there is usually enough advanced notice in the market that a new competitor is going to enter the specific segment. SOOT Analysts In this TLS paragraph, please introduce the SOOT analysis. For more intimation, see the recommended text. This section is laid out to summarize the analysis in a table, and is then followed by more detailed explanations of each item. Please see specific instructions in the four sections below the table.
STRENGTHS *indicates core competency *Wordless ASIA Engineering Team Experience of the Executive Management Team Strong capital base WEAKNESSES Only two Graphic Card Manufacturers signed up to produce Graphic Cards based on 36 chips No PC MEMO relationships established yet No reputation yet OPPORTUNITIES Approaching the mobile market (Phones/Tablets), with either licensing the technology to SoC companies Finance the game development efforts of Independent Game Companies to focus their efforts specifically on the 36 product Develop out of the existing product a EGGCUP, to be used in Supercomputers.
THREATS Competition (MAD and Nevada) moving to new FAA technology faster than 36, removing the advantage on the power front Competition launching new designs that are as efficient as g’s, but with the advantage of greater brand recognition Game Developers hitting a plateau with their new generation of games, that don’t require anymore improvements on the graphics card front Strengths g’s first strength is having a world-class ASIA (Application Specific Integrated Circuit) engineering team.
The members of the team have on average 15 years’ experience in he field of development of low power and high performance ASIA and some of the members of the EGG engineering team have been instrumental on developing in the past key products in the graphics card market. The second strength of 36 is the extensive experience of the executive management team. The CEO of 36 used to serve as the president of MAD (direct competitor) for over 10 years. The Sir. Vice President of engineering was the head of engineering at UDF in 2001 and after the acquisition of UDF by Invalid, he served as the head of engineering products until joining 36.
The Executive Vice President of Sales and Marketing has over 20 years’ experience in building rapid growth sales and marketing teams in seven companies. The third strength/advantage 36 has is its strong capital base. 36 got over the past 2 years funding from venture capital in excess of $175 million and currently still has $100 million in the bank, which at current and planned spending levels should sustain the company for another 30 month. Weaknesses The first weakness in g’s strategy is that 36 has only managed to sign-up two mid- tier Graphic Card Manufactures (VEGA and XP).
The Graphic Cards Manufactures SE the reference boards 36 delivers and implement their own cooling solution plus additional tweaks to boost performance of the cards by 5%-10%. A large part of the Mainstream and Hardcore Gamers like to buy their graphic cards from the top graphic card companies (SASS, MS’, GigaByte), due to the custom designs and extended warranties. This might limit the initial available TTY to cards in the market until 36 can sign-up the top graphic card companies as well. The second weakness in the strategy is that 36 has not established any relationships with PC Memo’s (Dell, HP, Leno etc. Which will limit the initial exposure of the product to the mainstream and hardcore gaming user. 36 will start pursuing 6 month after the launch of the product the PC Memo’s, to start including the lower end 36 products in their offerings. The third weakness in the strategy is that 36 doesn’t has the reputation of the two main competitors. MAD and Invalid have both been in the graphic card marketplace for almost 20 years and the end consumer knows what to expect from both companies. 36 is new to the game and will need to build this reputation over time to gain the confidence of the gamers. Opportunities
Additional opportunities persist for 36 in several areas that can be explored once G had a successful launch of its core product and got additional funding for development. The first opportunity is in the mobile market (phone/tablets). 36 is actively looking into creating reference designs for the mobile market that satisfy the unique requirements present (very low power, with fast performance). The big advantage of the mobile market is that the volumes of the market are extremely high (total annual volume in excess of 1 billion units) and 36 would only need to license the product to SoC companies (e. . Samsung, Mediated, Apple, Allowance) versus getting into production as well. The second opportunity for 36 is the EGGCUP (General Purpose Graphic Processing Unit) market, to develop cards that will power Supercomputers. The current prototype is already ahead of the completions (Invalid’s Tests and Intel’s XENON Phi) and this is a very high margin, but low volume market that will give 36 additional market recognition. The third opportunities for 36 is to finance the game development of up-and-coming independent game developers to specifically optimize the games for the 36 product line.
MAD (with Mantle) and Invalid with Physic) have been quite successful with the strategy to boost the sales volume of their products. Threats 36 wants to look at potential threats that can derail the strategy in the future and has identified the following three areas: The first threat is that g’s competitors are moving faster to a new FAA technology than currently presented in their roadman, which would allow them to come closer to g’s low power requirements and allows them as well to boost the performance of their current generation of graphic chips without redesign.
The second threat comes from g’s competitors launching radically ewe design concepts for their graphic cards, which are equal or better to g’s design. This would remove g’s current advantage entirely and 36 would potentially lose market share. The third threat not only for 36 but as well for g’s competitors comes from Gaming Developers hitting a plateau with their next generation of games, which won’t require anymore additional performance from graphic chips. The graphic chip market is largely driven by game developers putting graphic features in place that require substantial upgrades to older gaming platforms.
One example of developers riving the graphics chip market was the release of Crisis by Create in 2007, which was not playable (with all graphic options enabled) even on high-end hardware available at the time. It took almost four years to have powerful enough graphic chips to be able to play the game with all options enabled, which gave the gamer an almost super realistic view. Market Objectives (launch During the next year, 36 seeks to achieve the following objective using their marketing mix, including product, price, place (distribution), and promotion strategies. Successful launch of the 36 graphic chip/card on a global scale.
Product Objective Launch the 36 graphic cards (own design and partners) in North/South America, Europe, Asia and Australia and achieve a global market share in the discrete graphic chip segment of 5% (approve. 3 MIM units sold) within 12 month from launch date. The distribution for the different products will be as follows: 70% Casual Gamer Segment with the product MIM units) 15% Casual to Mainstream Gamer Segment with the product 36105 (-?KICK units) 10% Mainstream to Enthusiast Gamer Segment with the product 36200 (-?KICK units) 5% Enthusiast to Hardcore Gamer Segment with the product 36205 (-?1 ASK units) Price Objective
To have an overall net-margin across all product lines above 20% Following the pricing including margins for the different products: Product Gamer Classification End-consumer Price Target Net-Margin 36100 Casual $75 6% 36105 Casual to Mainstream $145 26% 36200 Mainstream to Enthusiast $220 29% 36205 Enthusiast to Hard-Core $390 45% 36 expects that 8% of buyers of the 36100 product will make use of the software upgrade program (enabling via software the functionality of the 36105 product, with twice the performance) within 12 month of purchase. This will increase the overall margin for the 36100 product from 6% to approve. . 5% (the upgrade will cost $75 and the only cost for 36 is to send the software code to the buyer). For the higher end product line 36200, 36 expects that 40% of buyers will make use of the software upgrade program (enabling via software the functionality of the 36205 product, with margin tort the 3 00 product trot 29% to approve. 48% (the upgrade will coos and the only cost for 36 is to send the software code to the buyer). Place Objective Have the products available at all premier online computer resellers in North America, Europe Asia and Australia within 3 month of launch.
Promotion Objective To have a positive product review in all major computer gaming magazines and computer gaming online sides within 3 month of launch. Marketing Strategies Product Strategies Standard 2 year warranty versus 1 year for the competition. Optimized graphic driver updates every 6 weeks. On demand upgrades (software) on lower end products Price Strategies 80% more performance for only 20% higher prices Graphic Card Partner pricing will allow the partners to retain a 20% margin.
On demand upgrades allow initial lower purchasing cost for end-consumers, but allowing them to upgrade performance without replacing the Hardware Place Strategies Have the product available at all major online outlets (e. G. Amazon, Engage, Ebay etc. ) The product will be shipped from factory to reseller, skipping wholesales. Offer purchase of the card directly from the 36 website All detailed information, including standard gaming benchmark results, will be available on the 36 website Every game magazine (e. G.
Overplay, PC Gamer) and online game review site will get all models for testing and benchmarking purposes (to be retained for future testing) 36 is planning on having a large presence on E in June in Los Angels and Games in August in Cologne (two largest gaming inventions) Explanation of Strategies 1 . The above mentioned strategies will appeal to the end-consumer of the product, due to getting a better bang for the buck (faster performance for marginally higher price, longer warranty) and allowing the upgrade of performance without replacing the graphic card. . The pricing strategy will appeal to graphic card manufactures as well as retail outlets, because 36 will allow each of them to retain a margin of 20% (versus 12%-15% for the competition), which should allow 36 to get signing more graphic card manufactures as well as expand retail outlets 3. The promotion of the reduce through review magazine/online sites plus the presence at the two major gaming convention will create even greater awareness for the end-consumer of the product.
Tactics and Action Plan Product Action Plan Tactic Due Date Responsible Party Hire six additional device driver engineers to hold the promise of having optimized drivers for all major gaming releases. 30th June 201 5 Director of Driver Engineering discuss and vet warranty return process with retailers 30th May 201 5 Director of Operations Ensure upgradeable of product through encrypted Software Code 1 5th May 201 5 Director of HOW Engineering Price Action Plan