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What is music2go (m2g)?


A marketing simulation game-: an interactive, live
marketing case study online!

Teams compete against one another in a simulated


consumer electronics industry

Based on the US portable MP3 player (PMP3P) market


1995-2001

What is music2go?
Companion Product to Etzel et al (2002)
Marketing

Market Analysis Segmentation

The Marketing Mix


Marketing Strategy

m2g Industry Overview:


Five identical student controlled PMP3P firms Students make decisions relating to all four
areas of the marketing mix promotion product design pricing distribution

3 consumer market segments differentiated by


age family income tastes lifestyle

5 Marketing Teams
Distribution

Controls Marketing Mix

Pricing

For Control of Three market segments


Sports

Promotion

Standard

Product Design
Youth

music2go and Marketing

a) Product Design

Characterization

Product Segments

Firm Decision Field

2 Dimensions
- styling - tech specs

Different
Configurations

Contract
Manufacture

Emergent Segment
(Sports)

R&D
- product cost - perceptual configuration

New Segment
(Kids)

m2g: Initial Perceptual Map


Segment Key
Technical Specs

Sports
Available

Youth
Unavailable

Standard Style

m2g: Concluding Perceptual Map

Sports Technical Specs

Youth

Standard Style/Design

b) Promotion

Advertising

Sales Promotion

Optimizing the mix

Media & sub-media


selection

Trade shows Training Premiums


displays

Product segments
- lifestyle -demographics

TV Radio - station format Newspaper Magazine - category

Product lifecycle
characteristics

Point of purchase Media type/sub-type Rebates

Promotion: m2g
Advertising Product Awareness Consumer Demand (Sales) Distributor performance Sales Promotion

Distribution coverage

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c) Distribution

Distribution Channels

Optimizing Distribution

Consumer Electronics
(local electronics store)

Product Segments
- purchase behavior - demographics

Department
(e.g Sears)

Discount
(e.g Wal-Mart)

Channel characteristics Sales Rep support

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Distribution: m2g
# Reps
Distributor Support Demand (sales)

Rep remuneration

Coverage Segment

Potential Sales
Channel

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d) Price

Market Conditions

Optimizing Price

Established product, price


ranges dictated by market

Segment characteristics
- elasticity of demand price ranges -

No substitute products

Ability to reduce variable cost Product lifecycle stage through R&D Channels of distribution

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Manufacture Cost

R&D

Base Cost

Pricing: M2G

Distribution Markup Support Discount Competitor Pricing

Market Price Range (segment)

Recommended Retail Price (RRP)


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e) Segmentation

Demographics:
18 years and less Fashion conscious Purchases made by
parents

Youth Segment
Promotion:
Mass media Point of sale
promotion

Product
Emphasis on
styling

Distribution
Deep product
assortment

Pricing:
$50- $60 Relatively elastic
demand

Customer service
(purchase advice)

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Sports Segment
Demographics:
19-34 years of age Active lifestyle No family
commitments, high disposable income

Promotion:
Targeted media Distributor sales
force training

Product
Emphasis on
technology & styling

Distribution
Deep product
assortment

Customer service

Pricing:
$100- $150; Relatively
inelastic demand

(advice, after sales service)

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Standard Segment
Demographics:
19-34 years of age Less active lifestyle vs
sports

Promotion:
Broad reach media Distributor sales
force training

No dependents, high
disposable income

Distribution
Broad product line
(accessories)

Product
Leverage use of
existing media

Customer service
(sales advice)

Average styling
& technology

Pricing:
$60-$100; Relatively unit
elastic demand 17

f) The product lifecycle


Marketing variable Product

Growth
in specs

Maturity

Decline
minimization

Improvement Differentiated Cost Cost


reductions Lowest

Price

Lower over
time

Increasing Selective Counteract


substitution

Distribution Intensive Promotion

Intensive Securing
purchase commitment

Brand
preference

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music2go: A Summary
Interactive real time business simulation
Application of:
Market Analysis Segmentation The Marketing Mix The Product Lifecycle

Ideal partner product for marketing course


incorporating Etzel (2002)
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