Marketing Mission Statement

Easy Strainer Inc.s marketing division mainly focuses on increasing awareness of our
product, having an effective market positioning in the cookware industry, and generating sales.
We plan on using various marketing strategies to reach consumers and selling channels. The
Easy Strainer aims to differentiate itself from competitors with its unique and convenient
straining function.

Marketing Objectives
1. Increase Awareness
MK Exhibit 1: Positioning Maps
We will maintain consistent messages and
color schemes throughout or advertisements so the
Easy Strainer is easily identifiable and recognized.
In that way, we will connect a very specific need to
our product. We also will advertise in multiple
outdoor channels so the Easy Strainer will be
relevant in common places like bus stops, airports,
or malls. We can measure our success by analyzing
the percent change in awareness in each year of
business.

2. Improve Position amongst Competitors

To improve our position amongst our
competitors we strive to maintain customer
excellence by having superior customer service in our online presence (through customer
interaction on the Easy Strainer Facebook page and company site) and by developing a clear
and precise positioning strategy1 (MK Exhibit 1: Positioning Map). As you can see from the
exhibit, Easy Strainer is not quite perceived as best amongst its competitors. We will focus our

Grewal, Dhruv, Ph. D, and Michael Levy, Ph. D. Marketing. 4th ed. Boston: McGraw Hill Education,

marketing efforts on making Easy Strainer perceived the best amongst competitors by educating
our consumers and stressing how it is durable, visually appealing, and easy to use. We can
measure whether we are considered to be excelling in this area through collecting survey data
each year of business and asking our target market to rank us in these attributes again.
Segmentation
MK Exhibit 2: Segmentation Tree

After conducting one-on-one interviews, online surveys, and a focus group, we

determined our target segments by looking at demographic and psychographic characteristics.
Specifically, we broke down our target market by gender, age, income, and how often someone
cooks (MK Exhibit 2: Segmentation Tree).
Through several interviews, it became apparent that women were more interested in our
product idea and are generally in control of cookware purchases within their household.
Additionally, we will not be targeting consumers older than the age of 64 because typically their
enthusiasm for cooking has waned.2 We also found that middle class individuals were not
willing to spend over $50 for our product; thus, we chose to focus on households with an income
of at least $60,000. MRI+ reports support our decision by stating that the majority of households

Elani, Gabriela. "Cookware - US - July 2014." Cookware. July 1, 2014. Accessed November 20, 2014.
http://store.mintel.com/cookware-us-july-2014).

that buy cookware have an annual income above $60K.3 Lastly, we separated the market by their
likelihood to cook because studies show that low income groups spend more time cooking than
high income groups. 4 We affirmed this research by collecting 180 of our own surveys. Our
results showed a clear trend that people with higher incomes, above $150,000, would buy our
product despite cooking very infrequently whereas surveyors with a lower income, $60,000$150,000, were more likely to purchase our product if they cook at home multiple times a week.
The number of households with females between the ages of 18 and 64 is estimated to be
55,205,853.5 We then eliminated the number of households with a household income below
$60,000. Finally, we divided the segments by cooking frequency and determined we would
target those who cook at least once a week for the higher income bracket, and those who cook at
least three times a week for the middle income bracket. We named the middle income segment
the Daily Cooking Dames and estimated the segment size to be 11,457,544 and named our
higher income segment the Luxurious Ladies and estimated the segment size to be 7,119,347
(MK Appendix 1: Segmentation Size Calculations). We chose the Daily Cooking Dames as our
primary segment because they represent a larger portion of cookware sales and through survey
results, we found that the purchase intent of the Luxurious Ladies is higher than the Daily
Cooking Dames purchase intent. Thus, we will focus our marketing strategies to this larger group
in order to adjust for their lower purchase intent.

Communication, Budget, and Creative

Pre-Year 1
Before launching our product into retailers, we will account for some marketing expenses
to aid production decisions. These expenses include conducting market research through
interviews and focus groups, as well as fees for trade shows and trade magazines. The overall
cost of these efforts totals $65,996.17, which is approximately 15% of our year 1 IMC marketing
expenses.
3

Cookware that average household owns, MRI+, accessed November 20, 2014.
http://www.mriplus.com/account/home.aspx
4

Lindsey P. Smith, Shu Wen Ng, and Barry M Popkin, Trends in US home food preparation and
consumption: analysis of national nutrition surveys and time use studies from 1965-1966 to 2007-2008
Nutrition Journal 12: 45 (2013): accessed November 22, 2014, doi: 10.1186/1475-2891-12-45.
5

Cookware that average household owns, MRI+, accessed November 20, 2014.
http://www.mriplus.com/account/home.aspx

Year 1
In year 1, we will advertise in Food Network Magazine and Saveur, which generates a
combined 5.73% awareness for our segments. To increase awareness in later years, we will
implement a coordination plan to advertise through different mediums simultaneously in selected
cities. These strategies include fairs, billboard advertisements, and food truck advertisements to
generate a greater awareness for our product. Additionally, public relations blogs and magazines
in combination with our online advertisements in this year give us 4% total awareness. Trade
magazines and trade shows complete our push strategy to generate awareness amongst potential
retailers. At the end of year 1, the primary segment generates 7.03% awareness and the
secondary segment generates 7.57% awareness with total marketing spending of $439,974.47
(MK Appendix 2: IMC Year 1).
Year 2
Our marketing strategy will remain unchanged from the previous year; we expect our
consumers to generate awareness through word of mouth. However, we will include the addition
of point of purchase displays at select retailers that will grant us 1% awareness per segment. We
also expect awareness to increase 2% from year 1 from more online advertisements. At the end
of year 2, the primary segment generates 10.24% awareness and the secondary segment
generates 10.96% awareness, with a total marketing spending of $464,124.47 (MK Appendix 3:
IMC Year 2).
Year 3
Year 3 marks the visible results of our coordination strategy where we have
advertisements across different channels at the same time in highly populated cities. We will add
back-lit dioramas in mall locations and begin to increase the number of times we advertise
through our previous strategies for higher awareness. At this point, we also start to take
competition into account and adjust the awareness accordingly. The primary segment generates
14.43% awareness and the secondary segment generates 17.29% awareness, with a total
marketing expense of $609,792.44 (MK Appendix 4: IMC Year 3).
Year 4
In year 4, we will change up our marketing strategy. We will stop advertising through
POP displays, the Food Network Magazine, as well as decrease our participation in trade shows
and trade magazines. Instead, we will have ads in airports, bus stops, and the magazine, Taste of
6

Home. Competition will also start to negatively impact our sales, but will generate 2.73%
awareness between both segments. The primary segment generates 19.81% awareness and the
secondary segment generates 21.22% awareness in total, with a total marketing spending of
$680.739.36. (MK Appendix 5: IMC Year 4).
Year 5
MK Exhibit 3: Map of Coordinated Advertisements

In year 5, we will not advertise through new mediums, and instead will increase the
number of advertisements we show throughout the year in our existing mediums. In this year, we
will maximize our advertising campaigns in each of the selected cities (MK Exhibit 3: Map of
Coordinated Advertisements). Our increased spending will generate an awareness of 26.26% and
26.85% awareness for both segments, respectively, with a total spending of $748,543.11 to
generate this accumulated awareness (MK Appendix 6: IMC Year 5).
MK Exhibit 4: Logos

Creative Strategies
Logo
In considering the creation of our logo, we researched
our competitors such as Caphalon and Le Creuset and noticed
a trend with sleek, clean, and simple logos (MK Exhibit 4:
Logos). As such, we wanted to create a logo that would be

appropriate for the industry while appealing to both of our segments. Our first logo employed a
pot in the back of the product name, but then we adapted our logo and eliminated the pot, which
we thought was not sophisticated enough. Our second and final logo is appealing to both of our
target markets because it is sleek, simple, and not extremely detailed. We used cursive font for
the Easy to attach the feeling of ease with the word.

Slogan
In brainstorming slogan options for the Easy Strainer, we wanted something simple that
would also emphasize the convenience of our product. Some slogan options we considered
include: Cook Easily, Live Easily; Find your Inner Chef; Strain Your Pain Away; and Dont
Strain Yourself. We thought that Find your Inner Chef could best capitalize on the trend of
cooking at home; however, when presented to a variety of consumers, many preferred Dont
Strain Yourself because it spoke to the product functionality. Dont Strain Yourself is featured
consistently across our ads and plays upon both the straining feature and the convenience of the
product.

Pull Marketing Strategy

Traditional Media
MK Exhibit 5: Traditional Media Across Five Years
Traditional Media
Yr 1
Yr 2
Food Network Magazine Cost
$181,500.00 $ 181,500.00
Food Network Magazine for Daily
Cooking Dames CPM
$
145.04 $
145.04
Food Network Magazine for Luxurious
Ladies CPM
$
572.25 $
572.25
Saveur Cost
$ 76,600.00 $ 76,600.00
Saveur CPM for Daily Cooking Dames $
780.20 $
780.20
Saveur CPM for Luxurious Ladies
$
160.80 $
160.80
Taste of Home Cost
$
$
Taste of Home CPM for Daily Cooking
Dames
$
$
Taste of Home CPM for Luxurious
Ladies
$
$
Total Cost of Traditional Media
$258,100.00 $ 258,100.00
Total Awareness Generated for
Daily Cooking Daisys
2.94%
2.93%
Total Awareness Generated for
Luxurious Ladies
2.79%
2.77%

Yr 3
Yr 4
$ 235,980.00 $
$

145.04 $

$
572.25
$ 122,140.00
$
780.20
$
160.80
$
-

$
$ 183,210.00
$
780.20
$
160.80
$ 248,000.00

Yr 5
$
$

$
$ 183,210.00
$
780.20
$
160.80
$ 316,000.00

74.25 $

74.25

$
$
268.57 $
268.57
$ 358,120.00 $ 183,210.00 $ 183,210.00
3.85%

7.68%

9.62%

4.08%

7.18%

7.60%

In years 1 and 2, we will have a 1/3 page advertisement in Food Network Magazine and
Saveur, which are primarily read by our primary and secondary segments respectively. In year 1,
8

the Food Network Magazines cost per thousand viewers for our primary segment is $145.04 and
generates an awareness of 2.73%. Saveurs cost per thousand viewers for our secondary segment
is $160.80 and generates an awareness of 1.67% (MK Exhibit 5: Traditional Media Across Five
Years). By year 3, we plan to have a page instead of 1/3 page advertisement, which will
generate 29.36% more awareness than in year 2. Our growth strategy for traditional media
includes replacing Food Network Magazine with Taste of Home in year 4, which generates over
100% awareness growth from year 3 to 4 for both segments. Because a greater number of Taste
of Homes circulation fits into our primary segment as compared to Food Network Magazine,
advertising in Taste of Home will lower our cost per thousand viewers to $74.25.
In the first three years, we will advertise four times a year in both the Food Network
Magazine and Saveur. The Food Network Magazine uses a modern, bright layout to spotlight
cooking recipes and chefs as featured on the television network; we believe this will attract our
primary segment and return a decent awareness at a low cost.6 Saveur capitalizes on culture and
tradition in relation to cooking, a trait our secondary segment is likely to value.7 As the Easy
Strainer matures into the fourth year, we move into Taste of Home and move out of Food
Network Magazine. The mission statement for Taste of Home emphasizes uniting home cooking,
which aligns well with our promotion of home cooking in our family themed ads and will be
attractive to our segments.8
The main strategy of our magazine advertisements is to educate consumers on our pots
unique straining functionality. We created two advertisements to achieve these goals (MK
Appendix 7: Magazine Advertisements). Our first advertisement depicts a happy family making
pasta using the Easy Strainer with the slogan Dont Strain Yourself. We believe our middle
income segment includes mothers; thus, it is important to advertise a family dynamic. A study
reveals that several mothers are organized, informative, and in control of purchasing the
product, making them key influencers.9 Our second advertisement employs our signature
colors: black, red, white, and gray. It is sleek, concise, and very simply shows that the steps of

"Food Network Magazine Media Kit." Accessed November 21, 2014.

http://s3.amazonaws.com/jo.www.foodnetworkmediakit.com/uploads/option/files/8/original.pdf.
7
"Saveur Media Kit." Accessed November 21, 2014. http://www.bonniercorp.com/MediaKit/Saveur.pdf.
8
"Mission Statement." Taste of Home Media Kit. Accessed November 21, 2014. http://mediakit.tasteofhome.com/.
9
Sarah Boesveld, Majority of moms in TV ads are intensive, family focused, analysis finds, National Post, May
13, 2012, accessed November 20, 2014, http://news.nationalpost.com/2012/05/13/majority-of-moms-in-tv-adsfocused-are-intensive-family-focused-analysis-finds/

how to use the easy strainer are as easy as 1, 2, 3. We will alternate between both
advertisements to appeal to both of our target segments.
Fairs
MK Exhibit 6: Event Marketing Costs and
Awareness
Yr 1
Yr 2
Yr 3

Event Marketing
Americas Food and Beverage Show
(Miami)
Boston Home Show (Boston)
International Houseware Association
(Chicago)

Western Foodservice and Hospitality

Expo (Los Angeles)
Home Expo (Las Vegas)
Total Cost of Event Marketing
Awareness for Daily Cooking Dames
Awareness for Luxurious Ladies

Yr 4

Yr 5

$
$

4,502.00 $
3,093.00 $

4,502.00 $
3,093.00 $

4,502.00 $
3,093.00 $

4,502.00 $
3,093.00 $

4,502.00
3,093.00

3,237.00 $

3,237.00 $

3,237.00 $

3,237.00 $

3,237.00

$ 7,410.00 $ 7,410.00 $
$
$
$
$
$ 7,526.00 $ 7,526.00 $ 7,526.00
$ 18,242.00 $ 18,242.00 $ 18,358.00 $ 18,358.00 $ 18,358.00
1.09%
1.46%

1.09%
1.46%

1.10%
1.47%

1.10%
1.47%

1.10%
1.47%

We selected to attend fairs and expos in highly populated cities such as Miami, Boston,
Chicago, Los Angeles, and Las Vegas. In years 3 through 5, we decide not to attend the Western
Foodservice and Hospitality Expo in Los Angeles and instead will attend the Home Expo in Las
Vegas. We plan to increase advertisements through alternate mediums in Los Angeles and want
to attend fairs in other cities to increase variety. Total costs of attending fairs and expos remain
almost constant throughout the five years, which include airfares, hotel rates, booth workers
salary and training costs, costs to exhibits, and assumed shipping costs of $120 and food and
misc. expenses to be $35010 (MK Exhibit 6: Event Marketing Costs and Awareness).
In our event booth, we will maintain our color scheme and feature images of families
using the Easy Strainer. We will also showcase the Easy Strainer on the point of purchase
display, and hand out an informational pamphlet that details how the Easy Strainer works and
our company contact information(MK Appendix 8: Event Booth and Pamphlet). In addition, we
will include an informational insertion discussing our Corporate Social Responsibilities (MK
Appendix 9: Corporate Social Responsibility Insertion).

10

MK 323 Marketing Management Tutorial: IMC (Awareness), Boston University, accessed November 20,
2014.

10

Point of Purchase
Our Point of Purchase display, which we use in the first two years of business, is a replica
of the Easy Strainer pot. (MK Appendix 10: Point of Purchase Display) Our Point of Purchase
display shelf will be in stores for January and February only, to increase awareness during slow
demand periods. After year 3, we will discontinue advertising through POP displays because we
generate greater awareness through other channels. POP displays are expected to cost $10,000
per year per target segment; therefore, POP displays for our company total $20,000 per year for
all five years, generating a 1% awareness per segment.11

Online
MK Exhibit 7: Online Advertising
Online Advertising
Total Cost of Online Advertising
Awareness Generated for Both
Segments

Yr 1
Yr 2
Yr 3
Yr 4
Yr 5
$ 47,901.30 $ 50,901.30 $ 68,996.70 $ 82,510.20 $ 101,035.20
1%

3%

4%

5%

7%

For our online advertising, we researched our competitors social media pages and
company websites as references for our own page. A reoccurring trend we plan on following is
spreading product campaigns and company initiatives across all online platforms. On both our
Facebook and Twitter, we will post recipes, customer success stories, and photos of employees
volunteering to keep all online advertisements aligned. Similarly, we will employ multiple
similar content strategies across our social media platforms to stay relevant among our potential
consumers and generate awareness of our product.
Online costs will account for 15% of our total marketing expenditures every year and will
help us reach a wider audience. We will utilize Google Adwords to show our product to potential
consumers when searching certain keywords such as cookware and strainer. This feature
will allow us to advertise our website link in the corner of a YouTube video advertisement. We
will also have banner ads on Facebook, which has over 1.32 billion monthly active users12. In
year 5, we plan to spend an extra $20,000 advertising our campaigns through Buzzfeed, which

11

MK 323 Marketing Management Tutorial: IMC (Awareness), Boston University, accessed November 20,
2014.
12
The Benefits of Advertising on Facebook and Other Social Networking Sites, Business Creator Plus, Accessed
November 23, 2014, http://www.businesscreatorplus.com/benefits-advertising-facebook-social-networking-sites/

11

will tie in with the trend of consistent online efforts to advertise to potential consumers13 (MK
Exhibit 7: Online Advertising).

Outdoor Advertising
MK Exhibit 8: Outdoor Advertisements
Outdoor Advertising
Bus Stop Ads
Billboard Ads
Airport Ads
Mall Ads
Total Cost for Outdoor Advertising
Awareness for Daily Cooking Dames
Awareness for Luxurious Ladies

Yr 1
$
$ 18,000.00
$
$
$ 18,000.00

Yr 2
$
$ 18,000.00
$
$
$ 18,000.00

Yr 3
$
$ 24,000.00
$
$ 6,000.00
$ 30,000.00

Yr 4
$ 12,000.00
$ 27,000.00
$ 17,500.00
$ 8,000.00
$ 64,500.00

Yr 5
$ 12,000.00
$ 30,000.00
$ 29,000.00
$ 30,000.00
$ 101,000.00

0.54%
0.72%

0.54%
0.72%

0.90%
1.20%

1.94%
2.58%

3.03%
4.04%

Billboards will be placed in six large cities: New York, Boston, Chicago, L.A., Miami,
and Dallas beginning in year 1. In all 5 years of our Integrated Marketing Schedule, we plan to
advertise on billboards in major cities all in the month of May. Because the message of our ad
calls upon a mothers frustration, the Easy Strainers convenience will appear more valuable
when school ends and busy summer plans begin (MK Appendix 11: Billboard Advertisement).
The number of cities we advertise in will also increase as our company grows. Each billboard
costs $3,000, and placing them in six cities cost $18,000. 14
Beginning in year 3, we will expand our outdoor advertisement strategy by advertising at
select malls through backlit dioramas and elevator wraps. We chose to advertise in malls because
consumers will see the advertisements when they are in the buying mode15. Similarly, we will
advertise at airports through backlit dioramas and banners, and bus stop ads beginning in year 4.
Having advertisements in prime transportation locations allows these ads to be unavoidable to
commuters and receive multiple repeat views to instill the advertisement message in the viewers
mind. In year 5, online advertisements spending will be $101,000 and account for 3.03% and
4.04% awareness for our primary and secondary segments respectively (MK Exhibit 8: Outdoor
Advertisements).

13

What Online Ads Really Cost, Digi Day, Accessed November 23, 2014, http://digiday.com/publishers/whatonline-ads-really-cost/
14
Billboard Advertising in 300 Cities Billboard Ads Company, BlueLineMedia, accessed November 20, 2014,
http://www.chicagomanualofstyle.org/tools_citationguide.html
15
Advantages and Disadvantages, Ooh Media Source, accessed November 20, 2014,
http://www.oohmediasource.com/advantages-and-disadvantages

12

Public Relations
MK Exhibit 9: Public Relations

PR Magazines
Yr 1
Real Simple
x
Southern Living
x
Best Cookware
x
Cookware Consumer Guide
x
Cooking Light
Eating Well
PR Blogs
Yr 1
Love and Lemons
x
The Pioneer Woman
x
Mommys Kitchen
x
Real Mom Kitchen
x
What's Cooking Chicago
x
The Blonde Can Cook
x
The Lazy Mom Cooks
x
The Cooking Mom
x
Carol's Cookery
x
My Cooking Life by Patty
x
Cast Iron & Wine
The Eclectic Chef
Dinner a Love Story

Yr 2

Yr 3
x
x
x
x

Yr 2

Yr 4
x
x
x
x
x

Yr 3
x
x
x
x
x
x
x
x
x
x

Yr 5
x

x
x
x

x
x
x

Yr 4
x
x
x
x
x
x
x
x
x
x
x
x

Yr 5
x
x
x
x

x
x
x
x

x
x
x
x
x
x
x

x
x
x
x
x
x

PR magazines and blogs generate a fixed 1% awareness for both segments and cost a
fixed $10,000 per year for all five years.16 We chose Cooking PR magazines and blogs that will
promote and talk about our product to their audience whom we consider to be potential
consumers. We selected the PR blogs that feature strong female personalities as the main
contributors (MK Exhibit 9: PR Magazines and Blogs). We plan to lend our pots to the bloggers
who act as influencers over their loyal followers.

Food Truck Advertising

MK Exhibit 10: Food Truck Advertising
Food Truck Advertising
Total Food Struck Cost
Awareness for Daily Cooking Dames
Awareness for Luxurious Ladies

Yr 1
Yr 2
Yr 3
Yr 4
Yr 5
$ 15,000.00 $ 15,000.00 $ 23,500.00 $ 26,000.00 $ 45,000.00
0.45%
0.60%

0.45%
0.60%

0.71%
0.94%

0.78%
1.04%

1.35%
1.80%

The food truck emerged because restaurateurs sought cheaper alternatives to opening a
full restaurant.17 Due to the rise in food truck popularity, advertising on food trucks will generate
16

MK 323 Marketing Management Tutorial: IMC (Awareness), Boston University, accessed November 20,
2014.
17
"Where Did the Modern U.S. Food Truck Movement Really Start?" The Huffington Post. August 25, 2012.
Accessed November 21, 2014. http://www.huffingtonpost.com/quora/where-did-the-modern-us-f_b_1829587.html.

13

greater impressions on our target segments, especially because food trucks are not limited to one
location and travel around multiple locations.
We will advertise on Roadstoves food trucks in Miami, Boston, Chicago, L.A, Denver,
and Austin for four months in year 1, which will increase until we are advertising all year round
in year 5. The truck will feature the Easy Strainer logo and an image of the pot (MK Appendix
12: Food Truck Advertisement). To develop a stable relationship with Roadstoves, we plan to
advertise year round in select cities by year 5. In year 5, we will advertise in San Francisco for
six months and in Indianapolis for four months. In year 1, truck advertisement generates
respectively 0.45% and 0.60% for our primary and secondary segments. In year 5, we expect to
reach 1.35% and 1.80% awareness for two segments due to the increased costs and longer time
exposure (MK Exhibit 10: Food Truck Advertising).

Push Marketing Strategy

Trade Shows
Our marketing strategy includes participation in trade shows and advertisements in trade
magazines in all five years to establish relationships with potential retailers that might carry our
product. We will attend the Total Housewares & Gourmet Market Trade Show in Dallas and the
International Home and Housewares show in Chicago. Our trade show booth design is the same
as our fair and expo booth design as we feel it will accurately show retailers what our product is
and the consumers who will buy our product. Brochures handed out at fairs and expos will also
be used at trade shows as they have a detailed description of our product and the corporate social
responsibilities we will incorporate. (MK Appendix 8: Event Booth and Pamphlet).

Trade Magazine
The marketing team designed the Retail and Trade Magazine advertisements for Fancy
Food and Kitchenware News with the idea of keeping it very straightforward. We include our
product, logo, slogan, and contact information, but mainly wanted to highlight the high quality
look of our product (MK Appendix 13: Trade Magazine Advertisement).

14

Measuring Effectiveness of Communications

Easy Strainer Inc. will monitor all marketing activities on our social media platforms:
Facebook and Twitter. We will utilize a social media tracker to track the percent increase or
decrease of likes and follows in each platform which will help us measure our social media
effectiveness. Conducting surveys is essential to measuring our effectiveness of communications
as a company. Upon request of a survey, our customer will be notified of a 5% discount they will
receive upon survey completion which is redeemable at their next purchase. In addition, our
CMO is responsible for maintaining constant contact with our retails and requesting positive or
negative feedback about our product.

Packaging
We gathered initial ideas for our packaging design by examining those of our
competitors. We found different types of packaging offerings at retail stores such as Bed Bath &
Beyond and Crate and Barrel and found that they focus mostly on the appearance and the
description of the product. For the packaging design, we decided to style our box with sharp and
clear colored pictures in order to grab consumers attention. Therefore, on the front and back, we
will use the same picture of a sink with our pot straining water to demonstrate how our product
works. On the left side of the box, we added a small description of the pot while on the right we
included an attribute chart (MK Appendix 14: Easy Strainer Packaging).

Channels and Pricing

MK Exhibit 11: Profile of the Retail Environment

Channel Distribution
The cookware market is highly
saturated and matured, but the innovative
and distinctive function of our product will
allow us to compete with established
companies. The major channels of
distribution for the cookware market are
comprised of independent retailers,
department stores, specialty stores, and

15

mass merchandisers.18 In order to create a profile of our all commodity volume, we decided to
combine department stores and specialty stores into chain retailers and adjusted for online sales
(MK Exhibit 11: Profile of the Retail

MK Exhibit 12: Breakdown of Retailers

Environment).
The category size of the
cookware market is $4.655 billion and so
to determine the major retailers of the
cookware market, we found total home
and garden sales for the major players of
the cookware market and weighted them
according to retail sales and number of
locations of each retailer (MK Exhibit
12: Breakdown of Retailers).
The Easy Strainer will be sold
through independent retailers and online
channels such as Amazon.com,
accounting for an ACV of 15.84% and 18.74% in the first two years. In year 3, we will begin to
penetrate into chain retailers, specifically Sur La Table, which will increase our ACV to 21.52%.
In year 4, we will enter Macys, another chain retailer and Target, a mass manufacturer,
generating an ACV of 27.07%. By year 5, we will have developed a strong reputation for our
product among retailers and customers and will penetrate into another mass manufacturer and
chain retailer, Costco and Bed Bath & Beyond respectively, resulting in an ACV of 36.36%.
(MK Appendix 15: All Commodity Sales Volume)

18

Cookware US July, Mintel. Accessed November 20, 2014,

http://academic.mintel.com.ezproxy.bu.edu/display/710004/

16

Pricing
MK Exhibit 13: Cumulative Purchase Intent

From our survey results, we determined that the profit-maximizing price for our product
ranges from $60 to $69.99. We believe that in order to communicate our product as a quality
brand, we are deciding to charge the Easy Strainer at a retail price of $79.99, especially in the
case that we expand in our product line and do not want to rebrand our brand image. This will
keep our product competitive amongst similar products, while still being offered at an affordable
and reasonable price for our segments. The cumulative purchase intents at this price are 10.95%
and 20.18% for our primary and secondary segments respectively. (MK Exhibit 13: Cumulative
Purchase Intent).

17

MK Exhibit 14: Competing Prices

Retail Selling Price

We are selling to independent retailers at
$39.99 for the first five years with a retailer margin
of 50%.19 We want independent stores to continue
carrying our product throughout the first five years as
they comprise 16% of all cookware market sales;
thus, we will not lower the selling price for mass
merchandisers but rather increase it to avoid dramatic
channel conflict when we enter chain retailers and
mass merchandisers (See MK Appendix 16: Retail
Channels Units, Prices, and Margins). In order to
determine pricing for chain retailers and mass
merchandisers, our research suggested retail prices of
competing products and found prices that were
similar across all channels of distribution (MK
Exhibit 14: Competing Prices). Thus, we decided on
a $43.99 selling price for chain retailers due to a
retailer selling margin of 45% and a recommended

retail selling price of $79.99.20 For mass manufacturers, although we found retail prices similar
to those in independent stores and chain retailers, we decided on a $45.59 selling price due to a
40% retailer margin with a recommended $70.99 retailer selling price.21 Due to our total unit sale
growth of 72.97% from year 1 to year 2, we believe that chain retailers will buy our product at
$43.99 to latch onto our product sales. Similarly, we believe mass merchandisers will also want
to benefit from our unit sales as demand continues to grow.

19

MK 323 Marketing Management Tutorial: Sales Projection, Boston University, accessed November 20, 2014.
Ibid.
21
Ibid.
20

18

Competition
Our product has a distinctive easy straining feature that stands out among competitors.
Our product design is not hard to mimic, thus competitors could offer products with
improvements to our straining functionality. Therefore, an Easy Strainer patent will help avoid
unwanted imitation by competitors.
Even though we will take actions to protect our company from some levels of
competition, it is impossible to perfectly avoid competition. We expect competitors to introduce
similar products to the cookware market in year 3 when our product is in the growth stage of its
product life cycle. This leads to an adjustment of 20% in year 3 sales unit. As our product starts
to penetrate in larger channels of distribution and exits growth phase, competition impact on our
sales increases to 30% and 35% in year 4 and 5 respectively.
MK Exhibit 15: Sales Volume of Retailer Channels
Year 1
Units Sold % of Total Units
Independent Stores
8,984
24.24%
Online
28,076
75.76%
Total
37,060
100.00%
Year 2
Independent Stores
23,095
36.03%
Online
41,007
63.97%
Total
64,101
100.00%
Year 3
Independent Stores
27,972
33.37%
Online
46,743
55.76%
Sur La Table (Chain)
9,109
10.87%
Total
83,824
100.00%
Year 4
Independent Stores
24,728
19.66%
Online
55,777
44.34%
Macy's (Department/Chain)
9,725
7.73%
Sur La Table (Chain)
15,217
12.10%
Target
20,359
16.18%
Total
125,806
100.00%
Year 5
Independent Stores
19,650
9.70%
Online
67,064
33.10%
Macy's (Department/Chain)
16,370
8.08%
Sur La Table (Chain)
18,296
9.03%
Target (Mass Merchandiser)
34,270
16.91%
Bed, Bath, and Beyond (Chain)
23,386
11.54%
Costco (Mass Merchandiser)
23,584
11.64%
Total
202,621
100.00%

19

Sales Volume
Four channels make up our sales
pool: independent stores, online, chain
retailer, and mass merchandisers. In year 1,
online channels will account for 75.76% of
total unit sales and independent retailers
will account for 24.24% of total unit sales.
In year 2, online channels will account for
63.97% of total unit sales and independent
retailers will account for 36.03% of total
unit sales. In year 3, Sur La Table will
begin to sell the Easy Strainer, which will
account for 10.87% of total unit sales.
Online channels will account for 55.67% of
total unit sales. Independent retailers will
account for 33.37% of total unit sales.
In year 4, Target will begin to sell
the Easy Strainer, will account for 16.18%

of total unit sales. Chain retailers will account for 19.83% of total unit sales with Sur La Table
accounting for 12.10% and Macys accounting for 7.73%. Online channels will account for
44.34% of total unit sales. Independent retailers will account for 19.66% total unit sales. In year
5, mass manufacturers will account for 28.55% of total unit sales. Target will account for
16.91% and Costco will account for 11.64%. Chain retailers will result in 28.65% of total unit
sales. Sur La Table will account for 9.03% total unit sales, Macys will account for 8.08% total
unit sales, and Bed Bath & Beyond will account for 11.54% of total unit sales. Online channels
will account for 33.10% of total unit sales. Independent retailers will result in 9.70% of total unit
sales (MK Exhibit 15: Sales Volume of Retailer Channels).

Sales Force
In the first two years, we will not have our own sales force as we are a start-up company
and will not need a sales force. Instead, we will hire a manufacturer sales representative to help
us place our products in independent stores. Beginning in year 3, we will hire our own sales
force as the manufacturer representatives salary exceeds that of sales force due to entrance in
chain retailers and soon thereafter, mass merchandisers in year 4 (MK Exhibit 16:
Manufacturers Sales Representative Expenses). Our salespersons salary is composed with two
factors: a fixed $60,000 base salary and a 5% bonus salary of each unit sold (MK Exhibit 17:
Sales Force Expense). We will continue to use a manufacturer sales representative to retain our
product placement in independent retailers.

MK Exhibit 16: Manufacturer Sales Representative Expenses

Manufacturers
Representative
Expenses
Independent
Chain Retailer
Mass
Merchandisers
Total
Commissions
(10%)

Yr 1

Yr 2

Yr 3

Yr 4

$44,098.58
-

$110,094.72
-

$139,088.71
$45,292.96

$44,098.58

$110,094.72

$184,381.67

MK Exhibit 17: Sales Force Expense

20

Yr 5

$116,528.00 $91,993.80
$117,537.50 $271,785.55
$95,937.29

$270,851.69

$330,002.79 $634,631.05

Sales Force Expense

Fixed
Variable
Total Sales
Sales Force Expense

Yr 1 Yr 2 Yr 3
Yr 4
Yr 5
0
0
60000
60000
60000
5.0% 5.0%
5.0%
5.0%
5.0%
0
0
$400738.86 $2025561.86 $5191815.43
0
0
$80036.94 $161278.09 $319590.77

According to our work time analysis, we will only need one manufacturer sales
representative throughout all five years (MK Exhibit 18: Salesperson Employment for Year 2-5).
MK Exhibit 18: Salesperson Employment for Year 2-5
Sales Hours Per Year For Each Company Salesperson
Sales Hours for Year 3
Sales Hours for Year 4
Sales Hours for Year 5

240
29
148
233

Sales Projection
Base Case Scenario
MK Exhibit 19: Base Case Scenario Sales Projection
Primary Segment: Females ages 18-64 with HHI of $60,000-$149,999 Base Case
YEAR
1
2
3
4
5
Adjusted Purchase Intention
13.71%
13.71%
13.71%
13.71%
13.71%
Awareness
7.03%
10.24%
14.24%
19.80%
26.26%
ACV
15.84%
18.76%
21.52%
27.07%
36.26%
Trial Units
17,490.25
30,356.26
48,688.00
85,495.49
152,294.85
*Competition adjustment
0.20
0.3
0.35
TOTAL UNITS
17,490
30,356
38,950
59,847
98,992
Average WEIGHTED manufacturer's
selling price to channel
$
49.08 $
47.67 $
47.12 $
47.01 $
46.71
Manufacturer sales ($)
$
858,505.01 $ 1,447,101.26 $ 1,835,356.93 $ 2,813,616.68 $ 4,623,985.74
YEAR
Adjusted Purchase Intention
Awareness
ACV
Trial Units
*Competition adjustment
TOTAL UNITS

Secondary Segment: Females ages 18-64 with HHI of$150,000+ Base Case
1
2
3
4
22.94%
22.94%
22.94%
22.94%
7.57%
10.96%
15.84%
21.12%
15.84%
18.76%
21.52%
27.07%
19,569.44
33,745.17
56,091.52
94,227.99
0.20
0.3
19,569
33,745
44,873
65,960

Average WEIGHTED manufacturer's

selling price to channel
$
Manufacturer sales ($)
$

49.08 $
47.67 $
960,561.37 $ 1,608,652.75 $

21

47.12 $
2,114,442.19 $

5
22.94%
26.72%
36.26%
159,429.76
0.35
103,629

47.01 $
46.71
3,100,999.26 $ 4,840,616.03

For the first two years, our product solely relies on sales from independent retailers and
online websites (ie Amazon.com), representing 16% and 12% of the cookware markets total
sales. Every year, our manufacturers sales representative contacts 80% of independent stores;
assuming a 30% penetration rate, our products combined ACV for the first two years is 15.84%
and 18.76%. Because of our high secondary segment purchase intent and our companys focused
efforts on generating awareness for our primary segment, unit sales are close across both the
segments in the first two years. Manufacturer sales for the first two years for our primary
segment are $858,505.01 and $960,561.37, and for our secondary segment are $960,561.37 and
$1,608,652.75 (MK Exhibit 19: Base Case Scenario Sales Projection). Every year, we expect
each segment to grow at .77% alongside the U.S. population22. We also must account for
households that we have already sold too, and subtract them from our target segment over
subsequent years (MK Appendix 17: Complete Base Sales Forecast).
In our third year, our company will establish its own sales force to enter the third largest
chain store in the cookware market, Sur La Table. This will create some channel conflict
between our independent retailers and chain store; as a result, 20% of our current independent
stores will drop our product during this year, but our companys overall ACV will increase to
21.52%. Unit sales will also be affected as our growth in revenue will attract competition and
take 20% of our unit sales per segment.
Year 4 will be the most crucial to our company. At this point, our product will have
reached the end of the growth phase of the product development life cycle. In year 4 we will
introduce our product to our first mass merchandiser, Target, and a department store, Macys.
Once again there will be channel conflict with independent retailers, thus another 20% of
independent stores will drop our product. Furthermore, Taste of Home will replace the Food
Network Magazine, resulting in greater awareness for both segments and an increase total unit
sales by 50.8%. Competition will come in much stronger in this year, taking 30% of our unit
sales per segment, which is why it was important for us to increase our awareness in year 4,
especially because we have ample resources to do so.
In year 5, our product will enter the maturity phase of the product life cycle, with
entrance into a new chain store, Bed Bath & Beyond, and a new mass merchandiser, Costco.
Another 10% of independent retailers will have dropped our product due to channel conflict
22

"Indicators." Data. Accessed November 22, 2014. http://data.worldbank.org/indicator/SP.POP.GROW.

22

resulting in an accumulated drop of 50% across the 5 years. We will also have increased
awareness in both segments as our advertisements across multiple channels become more
intensive. In this year, competition will have become stronger, thus taking 35% of our unit sales
per segment. Manufacturer sales will reach a total of $9,464,601.77 for both segments (MK
Appendix 17: Complete Base Case Sales Scenario).
Optimistic Case Scenario
MK Exhibit 20: Optimistic Case Scenario Sales Projection
Primary Segment: Females ages 18-64 with HHI of $60,000-$149,999 Optimistic Case
YEAR
1
2
3
4
5
Adjusted Purchase Intention
14.85%
14.85%
14.85%
14.85%
14.85%
Awareness
8.01%
11.29%
15.80%
22.76%
30.24%
ACV
17.12%
20.60%
24.96%
34.12%
42.63%
Trial Units
23,339.14
39,815.28
67,764.35
133,935.84
222,421.68
*Competition adjustment
0.30
0.35
0.4
TOTAL UNITS
23,339
39,815
47,435
87,058
133,453
Average WEIGHTED manufacturer's selling price to
channel
$
52.15 $
50.65 $
50.07 $
49.98 $
49.67
Manufacturer sales ($)
$ 1,217,205.21 $ 2,016,659.20 $ 2,374,871.31 $ 4,350,879.22 $ 6,629,076.86
YEAR
Adjusted Purchase Intention
Awareness
ACV
Trial Units
*Competition adjustment
TOTAL UNITS

Secondary Segment: Females ages 18-64 with HHI of$150,000+ Optimistic Case
1
2
3
24.08%
24.08%
24.08%
8.67%
12.18%
17.81%
17.12%
20.60%
24.96%
25,433.50
43,206.77
76,646.10
0.30
25,433
43,207
53,652

Average WEIGHTED manufacturer's selling price to

channel
Manufacturer sales ($)

4
24.08%
23.99%
34.12%
141,174.08
0.35
91,763

5
24.08%
30.88%
42.63%
225,875.87
0.4
135,526

$
52.15 $
50.65 $
50.07 $
49.98 $
49.67
$ 1,326,431.93 $ 2,188,439.42 $ 2,686,141.02 $ 4,586,012.04 $ 6,732,026.02

The optimistic scenario assumed we would be able to incorporate and afford 3 corporate
social responsibilities (MK Exhibit 17: Optimistic Sales Projection). We would integrate
employees volunteering at a soup kitchen once a month to the existing CSRs regarding
sustainable packaging and donating pots to disaster relief. This increased our purchase intent to
14.85% in our first segment, and 24.08% in our second segment. In addition, we assumed that it
would take consumers three impressions instead of four to be aware of our product when
calculating magazine awareness. Word of mouth also changed as unit sales increased across the
five years. These changes in awareness resulted in a .98% and 1.10% increase in awareness in
the first year to a 3.98% and a 4.16% increase in our primary and secondary segments
respectively.

23

We will also adjust for our products channel distribution as acceptance rates improve.
For the first two years, our product remains in independent retailers, but assumed a 40%
acceptance rate after an 80% call rate thus acquiring a greater ACV from independent stores
quicker. We also assumed our product would break into retailers with a great ACV, such as
Williams Sonoma for chain stores and Wal-Mart for mass merchandisers. These assumptions
result in a 6.37% greater ACV percentage compared to base scenario by year 5.
For pricing, we assumed that we could charge a higher price for our product and maintain
the same purchase intent across both segments from our Base Scenario. The new retailer selling
prices for our product are $84.99 for independent and chain retailers, and $80.99 for mass
merchandiser, resulting in greater manufacturing sales for our company. Finally, we assumed
that competition would come in stronger in year 3 as we generate greater sales, thus we assume
competition will take 30%, 35%, and 40% of our sales in years 3 through 5 respectively.
Assuming the rest of our marketing strategy remained unchanged, total unit sales in year 5 for
our segments are to 268,979 and manufacturer sales are $13,361,102.88 (MK Appendix 18:
Complete Optimistic Case Sales Scenario).
Pessimistic Case Scenario
MK Exhibit 21: Pessimistic Sales Case Scenario Projection
Primary Segment: Females ages 18-64 with HHI of $60,000-$149,999 Pessimistic Case
YEAR
1
2
3
4
5
Adjusted Purchase Intention
12.22%
12.22%
12.22%
12.22%
12.22%
Awareness
6.44%
9.60%
12.07%
18.01%
23.97%
ACV
14.56%
16.71%
19.31%
24.01%
32.58%
Trial Units
13,128.34
22,596.65
33,037.50
61,598.42
111,619.46
*Competition adjustment
0.2
0.25
TOTAL UNITS
13,128
22,597
33,038
49,279
83,715
Average WEIGHTED manufacturer's
selling price to channel
$
46.02 $
44.69 $
44.17 $
44.05 $
43.75
Manufacturer sales ($)
$ 604,121.53 $ 1,009,862.92 $ 1,459,430.75 $ 2,170,759.09 $ 3,662,365.85
Secondary Segment: Females ages 18-64 with HHI of $150,000+ Pessimistic Case
YEAR
1
2
3
4
5
Adjusted Purchase Intention
Awareness
ACV
Trial Units
Repeat HHs
Repeat Units
BASES Units (before competition)
*Competition adjustment
TOTAL UNITS
Average WEIGHTED manufacturer's
selling price to channel
Manufacturer sales ($)

21.45%
7.11%
14.56%
15,808.61
51.79%
15,808.61

21.45%
10.43%
16.71%
26,759.37
51.79%
26,759.37

21.45%
13.57%
19.31%
40,364.45
51.79%
40,364.45

15,809

26,759

40,364

$
46.02
$ 727,458.19

$
44.69
$ 1,195,898.13

$
44.17
$ 1,783,098.25

21.45%
19.42%
24.01%
72,027.63
51.79%
72,027.63
0.2
57,622
$
44.05
$ 2,538,289.72

21.45%
25.24%
32.58%
126,951.69
51.79%
126,951.69
0.25
95,214
$
43.75
$ 4,165,434.41

For our pessimistic scenario we assumed we would only be able to afford one corporate
social responsibility in sustainable packaging and would not be able to donate pots to disaster
24

relief thus dropping our purchase intent for both segments to 12.22% and 21.45% for our
primary and secondary segments respectively (MK Exhibit 21: Pessimistic Sales Scenario Sales
Projection). We also assumed it would now take 5 impressions instead of 4 in order for
consumers to be aware of our product through magazine advertisements. Word of mouth will
also now be affected as the number of units we sell per year is lower than our base case units.
This resulted in a .59% and .46% decrease in awareness in year one and a 2.29% and a 1.48%
decrease in awareness in year 5 for our primary and secondary segments respectively We also
assumed it would now take 5 impressions instead of 4 in order for consumers to be aware of our
product through magazine advertisements. Word of mouth will also now be affected as the
number of units we sell per year is lower than our base case units. This resulted in a .59% and
.46% decrease in awareness in year one and a 2.29% and a 1.48% decrease in awareness in year
5 for our primary and secondary segments respectively.
We will adjust for channel distribution once again in our pessimistic scenario, but
acceptance rates will decrease. We assumed a 20% acceptance rate with independent retailers as
opposed to 30% in our base scenario, a 40% acceptance rate instead of 50% for mass
merchandisers. We also assumed it would take a longer time to penetrate retailers such as Sur La
Table and Bed Bath & Beyond and instead enter Macys in year 3 and enter Sams Club instead
of Target as our mass merchandiser in year 4 due to our slow product growth. These assumptions
result in a 3.68% lower ACV percentage compared to base scenario by year 5.
In terms of pricing, we assumed we would not be able price our product at $79.99
($74.99 for mass merchandisers) in retailers, and instead are now charging $74.99 ($70.99 for
mass merchandisers). This will result in a lower gross margin for our company as actual costs
per unit will remain at $19.99 in order to able to manufacture our product. Finally, we assumed
competition would not impact our sales in year 3, and would have a lower impact of 20% and
25% in years 4 and 5. Assuming the rest of our marketing strategy remained unchanged,
manufacturer sales in year 5 for both segments are $7,827,800.26 (MK Appendix 19: Complete
Pessimistic Case Sales Scenario).

25