Strategy: Already introduced Clocky to the Market, but what to do next? Introduce Ticky and/or Tocky?

Or continue refining Clocky and try to dominate the alarm clock market? Or branch out to other products that belay Nandas value proposition of adding character to objects to make them functional and fun. Options such as Spitlet the power saving buttplug, an ambulatory House Pot that can walk around and also store pot, and Follo the overly creepy personal assistant Robot. Demand: Who wants it (Clocky)?: People who have trouble sleeping so this is a sleep aid to help people wake up and be more physically and emotionally healthy, another is the fun market for those who think Clocky is cute. The question remains if which is better: to purchase a Clocky, or Ticky and Tocky, or branch out to a new product. Where is the demand for Clocky (and for Ticky and Tocky)? Those who might be angry at Clocky, or would want something that retains Clockys charm but adds new features and evolves the product line? Also have Football, Green, and Kiddie Clocky. Also add social media, blogs, and audiobook features. Are there any metrics to prove or disprove?: The ZMET Interview via HBS professor Gerald Zaltman. Survey Findings from Exhibits 7 and 8. How unique is it, and what sort of differential advantage would this product give the company? Clocky is cute and has wheels? It travels and chirps/whistles like R2D2? Operations: How is this priced? Cost based or value based? Cost per Unit was $17 (cost per unit, $1 for shipping, $1 for warehouse). And 15% would be returned back. Priced was cost based, at $50 for 1st 1000 units, then Exhibit 3 shows markup % on Distributor ranging from 109 to 334%). Now at $39, but some distributors undercutting to around $30. Plans are to price $50 for Ticky and $70 for Tocky. Revenue Streams? 2.2M in 2007, 1.5M in 2008, looking at 0.5M in 2009. AKA Not So Good for Clocky. Fixed and Variable Costs? Ticky and Tockys manufacturing costs will be 200% to 300% of that of Clocky. Assumes this includes fixed (gas, electricity, rent, SG&A) and varaible costs (labor, suppliers, materials). Would you have to cannibalize any existing products to keep this one up?: Ticky and Tocky will cannibalize Clockys sales and distribution, and cutting Clocks price will cut into margins. Ticky and Tocky will have to pick up the burden.

What are the short term and long term consequences? because it would be nice to have a short term deficit but long term profit growth, but vice versa wouldn't be cool. Nanda tried to introduce a laptop bag and a purse hybrid in 2007 but things didnt work out, due to her inexperience in that area and limited resources. E/I/C: Any external forces in the economy, industry, or competitors? is the timing good given the industry trends? Economy? Recession in 2008, which led to lower sales. Alarm Clock Market? US spent 1B in 2005, small 10% projection to 1.1B in 2010. Substitutes? Decline in watch market NOT affecting clock market as seen in Exhibit 6. Worry of Smartphone penetration. How adaptive are the competitor in responding with their version or a copy? Zeo Inc Personal Sleepcoach that is some sort of magical headband but has more limited market and $150 to $200 pricing. Puzzle Alarm Clock made by Danes that retail for $50 and can complete with Clocky, but has no soul or personality thus Clockys keeps its differential advantage. Cheap Chinese knockoffs at $20-30 that undercut Nandas profits. Mitigation techniques? Mitigate the Chinese by penetrating market quickly with extensive distribution and use pure momentum, so by the time the time copycats hit the market the newest version hits the market and renders the copycats obsolete. But this requires constant attention and R&D expenditures. Internal: Who will head this team up, is there a proper team in place? Nandas company? But she was at the mercy of her distributors, who had poor shelf placement, product market, and didnt really show Clockys features off to prospective buyers. Others only carried Clocky on a temporary basis. This might carry over to Ticky and Tocky. How will this product be distributed and sold, through existing channels, or having to make a new supply hub? Most distributors came to Nanda due to press attention but thats starting to wear off In 2007 majority most sales were Nandas website but by 2010 most were US retailers (35%) and international distributors (40%). Now its Fear that this would be a fad. Is there enough financing to account for the increased short term costs? I presume she has enough capital and she had to borrow from family.