Executive summary
The goal is to increase the overall market share and profits of MM’s Motors in the current market environment by targeting appropriate customer segments and proper allocation of marketing resources.
Initial Strategy: Our initial strategy was to concentrate on segment A because of the following reasons * MM possesses a competitive position in this segment in terms of quality product offering and close customer relationships through high level of customer support.
* Also, the competitors’ new product was highly competitive in thermal resistance parameter which would make it difficult for MM to compete in segments B and C
* The net price of…show more content… This poses serious competition to MM in segments B and C. Also, the price of MM motors is relatively high in comparison to that of competitors which is the main cause of low market share in segment D as well.
Challenges during simulation: During simulation, the primary challenge we faced was to decide on the key parameters that should be changed and the level of change in each of these parameters to get optimum profit and higher market share.
Key decisions: Since our initial strategy was to increase the sales volume of segment A, we decided to concentrate on sales force time percentage parameter for each segment and the list price of the motors.
We studied the effects of percentage increase of sales force time for each market segment individually along with decrease in list price on the overall profit of the company.
Solution Analysis
Decrease in list price from $142 to $136 and increase in sales force time percentage to 40% for segment D and to 30% for segment A. As we proceeded with the simulation, we found that * A decrease in list price and an
