Transcript Slingbox
Slingbox INNOVATIVE NEW PRODUCT Lindell Chew General Business Purpose • What is Sling Media, Inc • A digital lifestyle products company creating a family of consumer electronics products that are a natural extension of today’s digital way of life • The first member of the Sling Media family is the award-winning Slingbox™ . Products • What is Slingbox• A groundbreaking piece of hardwired ingenuity that will literally transform the way you watch television, for only $249.99 • It allows consumers to access their living room television experience at any time, from any location. • Uses a variety of different displays including laptops and desktop PCs, handheld computers and smartphones • Slingbox Intro Video Price • $250.00 • No additional monthly or service fees • Value Pricing -not too high but still suggests quality -because consumer takes a risk with an unknown brand it needs to be priced to reflect value Distribution • Selective • Available at home website, Comp USA, and Best Buy. • Not exclusive so that product would be available at stores our target market shops at. • Not intensive to reflect higher quality. Existing Competition • No direct competition • Indirect competition at the product category, generic and budget competition level – – – – Hotel Movies and Television Streaming Online Video DVD’s MLB TV Threat of New Entrants • Many companies with technological knowhow with large R&D budgets could easily enter the market pending progressive growth • Companies with a computer-based platform (Microsoft, Dell, Hewlett Packard) • Companies with a television-based platform (Sony, Hitachi, Samsung) Problems & Opportunities • Opportunities – First to Market – Market Share Supremacy – Partnership with Texas Instruments and Microsoft Window digital media – Internet and cable use (Requirements) are at an all time high and continue to grow Problems & Opportunities • Problems – Set up/Technology my discourage customers especially older population – Power house, entering the market and Target Market (size)- 3.5 Million • Cross section of people with cable/satellite TV and high speed internet • Affluent, tech savvy business travelers • Age 25 to 55 • 30 top urban cities Promotional Mix Promotions Subtotal-$4,375,000 Promotional Mix • 10% of Net Sales Revenue Internet 10% Public Relations 20% Sales Promotion 10% Advertising 60% Promotional Percentages Advertising • 60% of Promotional Budget • $2,625,000 • Highest percentage Need to create market awareness Need to create positive image for new product Public Relations • 20% of Promotional Budget • $875,000 • Large portion of $ goes to pay staff or P.R. firm Responsible for maintaining a positive image towards Slingbox Promotional Percentages Cont... Internet • 10% of Promotional Budget • $437,500 • Small Percentage: + It’s Cheap + Lot of “Bang for your Buck” -- Can be too Intrusive Sales Promotion • 10% of Promotional Budget • $437,500 • Small Percentage: + Can persuade consumers to buy -- Can be harmful to image Advertising Example SkyMall - Catalog • • • • Cost: $92,600 4% of Advertising Budget Reach: 155,000 passengers per quarter Positive Attributes: Captivated audience Average passenger spends 15 to 30 browsing the catalog Best possible way to target business travelers Advertising Example Business Travelers News – National Magazine • Cost: $404,260/year for 29 issues ½ page tabloid spread ads • 15% of Advertising Budget • Reach: 54,800 subscribers Pass along value/word of mouth would account for a much higher number being reached. • Positive Attributes: Focused directly on corporate business travelers Public Relations • Budget – $875,000 • Must be of interest to the audience of the medium chosen • Conduits with similar Reader Profiles to Slingbox’s target market • Press releases to mediums advertising in as well, like BTN • Examples of outlets to release information to: The Wall Street Journal • U.S. Circulation – 1,826, 493 • Average age – 50 • Graduated college or more – 76% • Average household income - $192,324 Fortune Magazine • • • • 830,000 copies circulated monthly 83% graduated from college Median household income is $165,200 88% traveled by commercial airline in the last year • 91% have a home computer • 85% are employed in the business, industry or the profession Internet Activities • Links to Slingbox’s website or Banners ads on TiVo's website Cross promotion effort • Banner ads on Business Travelers News Online, Skyscraper - $1,840 Monthly • Travelocity Sales Objectives • It is projected that in its first year of business Slingbox will sell to five percent of its total target market. • Therefore sales in its first year will total 175,000 units with sales of $43,750,000 in 2006. • Project a slight increase in sales in following years 3 Year Projected Income Statement 2006 2007 2008 $ 43,750,000 $ 44,187,500 $ 44,629,375 Cost of Goods Sold 30,625,000 30,047,500 29,009,094 Advertising 2,625,000 2,386,125 2,142,210 Public Relations 875,000 795,375 714,070 Personal Selling 437,500 397,688 357,035 Sales Promotion 437,500 39,688 357,035 Promotions Subtotal 4,375,000 3,976,875 3,570,350 General & Administrative 1,312,500 1,325,625 1,338,881 218,750 220,938 223,147 Total Expenses $ 36,531,250 $ 35,570,937 $ 34,141,471 Taxable Income 7,218,750 8,616,562 10,487,904 2,454,375 2,929,631 3,565,887 $ 4,764,375 $ 5,686,931 $ 6,922,017 Revenue: Net Sales Revenue Expenses: Testing/Evaluation Less: Taxes (34%) Net Income NPV, Payback Period and IRR • NPV - $1,459,619.57 • IRR – 27.96 • Payback Period – 2.19 years, initial invest of 10.5 million in venture capital secured to launch product