Transcript Music2Go

A Marketing Simulation
Click your left mouse button to learn more about this exciting new simulation
What is music2go?
The companion simulation
to “Marketing” 13th Edition
Students compete, individually or in teams, to make
their company successful in a challenging simulation of
consumer electronics marketing based on the US
portable CD player market.
With the aid of industry information and a substantial
suite of detailed reports they make decisions relating to
all four areas in the marketing mix
• Product design
• Pricing
• Promotion
Etzel, Walker, Stanton & Pandit
• Place (Distribution)
Students get “hands on” experience at making critical
decisions and seeing the outcome in a live, interactive
case study.
m2g Single-Player or Multi-Player
In the Single-Player simulation
students compete alone against
a computer opponent.
In the Multi-Player simulation
students compete in teams, running
identical firms against each other
live, via the internet.
within ..
within ..
2 consumer market segments
3 consumer market segments
• Standard
• Standard
• Youth
• Youth
• Sports
Single-PlayerMulti-Player
Click your left mouse button to progress through the Single-Player demo
When music2go starts you will
be able to see the Select Firm
Name screen.
This is your opportunity to
change the name of your firm.
After the first decision period
(one year) you can not change
your firm name again.
The second decision tree item
is the Year Ahead.
The first page of the report is
a news update on the
scenario, explaining what it is
that you should be trying to
achieve in music2go.
Pushing the right arrow
takes you to the next
page.
The Strategic Marketing
Planning report gives you
a reminder of the key
steps involved in
constructing a marketing
plan and chapter
references for the
Marketing textbook.
Finally the Forecast
Marketing Budget
Expenditure report shows
you how much you spent
last year and how much you
currently have available to
spend this year.
As you make decisions this
report will update to show you
how much budget you still have
available to spend. This report
is repeated in Forecast Results
The Industry Overview gives
you reports detailing what is
happening in the m2g
industry.
The first page of this report
is a summary of the key
results and an explanation of
what the other reports are.
In m2g Single-Player you are
competing against EWS
Audio and they start in a
stronger market position
than you do.
Pushing the down arrow
allows you to select any of
the Industry Overview
reports without having to
scroll through one by one.
For example if we select the
Market Share report. We will
jump to that report.
The Market Share report
clearly shows that EWS
Audio is the dominant firm in
the market.
Firm Results gives you
reports detailing the financial
performance of your firm.
The first page of this report
is a summary of the key
results and an explanation of
what the other reports are.
Here you can see
that your firm is
failing to meet its
sales forecasts.
We will investigate the failure to
meet forecasts further by
jumping to the Net Marketing
Contribution report.
The Net Marketing
Contribution Report
compares our forecast
with our actual result.
From this particular
report you can see
that the main problem
was that we failed to
reach our sales goals.
The purchase Market Research
decision screen is still being
worked on for the Fall release of
m2g.
Students will have the
opportunity to buy a selection of
market research reports from
two separate companies of
varying quality and cost.
To ensure that you can still play
this pre-release version of m2g
we have included a market
summary report on the second
page.
The All Product Details market
summary report shown below
gives you key information about
the effectiveness of your
promotional campaigns in
comparison to your competitor.
Note that EWS Audio is the only
firm with a product in the Youth
market segment.
Product Management gives you
reports detailing the performance
of your products.
The first page of this report is a
summary of the key results and
an explanation of what the other
reports are.
Here you can see that actual
sales of your Sonic product were
approx 60% of your sales
forecast.
Highlight the Product
Development tree item and
then click the + sign to list
all of your products below it.
The Product Development
tree item gives you reports
that detail the design
characteristics and
performance of your
products.
Here you can
choose to continue
with the current
design, update it
(with a new design
from below), or
abandon it.
Clicking your Sonic product
will open its product
development decision screen
Highlight the Price tree item
and then click the + sign to list
all of your products below it.
The Price tree item gives you
reports that give market
information relating to pricing
and retailer margins.
Here you can set your
product’s retail price
and retail margin. You
can also set your sales
forecast for each retail
channel that you
choose to supply it to.
Clicking your Sonic product
will open its pricing decision
screen
Highlight the Advertising
tree item and then click
the + sign to list all of
your products below it.
The Advertising tree item
gives you reports that give
market information
relating to advertising.
Here you can set your product Advertising strategies
and budgets. If you select a set strategy such as
growth then the computer will automatically allocate
your budget to the various media types.
Clicking Product Strategy and
Allocation will open the
Product Advertising Budgets
decision screen
Here you can change to
a custom advertising
strategy by setting your
product’s media
allocation yourself.
Clicking your Sonic product
will allow you to evaluate the
media allocation of the
advertising strategy that you
have chosen.
Selecting one of the
media tabs opens its
sub-category allocation
decision screen. E.g.
Radio and different
types of radio station
formats.
Here you can change to a
custom advertising strategy
by deciding how to split
your advertising budget
between the various radio
station formats.
Highlight the Sales
Promotion tree item and
then click the + sign to list
all of your products below
it.
The Sales Promotion tree
item gives you reports that
give market information
relating to sales promotion.
Here you can set your product Sales Promotion
strategies and budgets. If you select a set strategy
such as growth then the computer will automatically
allocate your budget to the various sales promotion
activities
Clicking Product Strategy and
Allocation will open the
product Sales Promotion
Budgets decision screen
Here you can change to a
custom sales promotion
strategy by deciding how to
split your budget between the
various sales promotion
activities available.
Clicking your Sonic product
will allow you to evaluate the
sales promotion activity
budgets of the sales
promotion strategy that you
have chosen.
The Product Management tree
item gives you reports detailing the
performance of your products.
The first page of this report is a
summary of the key results and an
explanation of what the other
reports are.
Here you can make your Sales Force Management decision
for each retail channel. You need to decide how many
sales reps to employ and how much their salary package
will be for each retail channel, e.g. consumer electronics.
Clicking Sales Force
Management will open its
decision screen.
Here you must decide how much inventory you want for each of
your products. If you believe your sales forecasts are accurate
then take your forecast sales units, subtract your existing
inventory and order the difference leaving an expected closing
inventory of zero.
Clicking Inventory
Management will open
its decision screen.
The Forecast Results tree item
gives you reports detailing the
forecast financial performance of
your firm for next year based on
the decisions that you have
entered.
The first page of this report is a
summary of the key results and
an explanation of what the other
reports are.
You should always check your Budget
Expenditure report before processing
your decisions
The Forecast Marketing
Budget Expenditure
report shows you how
much you spent last
year and how much you
currently have available
to spend this year.
As you make decisions this
report will update to show
you how much budget you
still have available to
spend.
DECISION TIME
Now that you have had a tour of the
decisions and reports available it is
time to show you a sample decision
We will start by checking how many of each
product actually sold in each retail channel last
year. Rounding to the nearest 100K the answers
are 600K, 500K and 500K.
Clicking your Sonic product
will open its pricing decision
screen
We will now update our sales forecast for each
retail channel with our rounded estimates based
on last year’s sales.
We save our changes
by pushing the apply
button.
We now decide to order 1,600,000 units which is the exact
amount of our sales forecast. This leaves some safety stock
in case we have underestimated demand.
Clicking Inventory
Management will open
its decision screen.
We decide to check our forecast
results based on our changed
sales forecast and inventory
order.
After seeing that we are forecast
to improve sales by 5% and Net
Marketing Contribution by 9% we
decide to rollover (process) our
decision.
Pushing the Rollover
button closes the
decision screens and
brings up the screen
below.
Pushing OK will process
our decision, pushing
cancel takes us back to
the decision screens.
Unfortunately our sales decreased by
10% instead of our forecast 5%
growth and Net Marketing
Contribution decreased 21% instead
of our forecast 8% growth.
After the rollover we decide to
check our results.
Opening up the Product
Development tree item we
see that we now have the
option to launch another
product.
However we decide to
rollback to the previous
year to try changing more
marketing decisions.
Pushing the Rollback
button closes the
decision screens and
brings up the screen
below.
Pushing OK will process
our decision to rollback
to last year, pushing
cancel takes us back to
this year’s decision
screens.
Now try playing m2g yourself. The first time you play it is
best to take 15 to 30 minutes to go through all of the screens
that you have just been shown so that you learn what
information you have available to you.
We also suggest only making a few decisions to begin with
and then rolling forward to see the effects and then rolling
back to improve them.
This incremental approach will allow you to quickly gain an
understanding of the underlying m2g simulation model and its
sensitivities.
A Marketing Simulation