MKT$2206$ Final Assessment Case Study

IMPORTANT NOTE: While you may have knowledge of the company featured in this case, SC Johnson, be sure to only use the information provided in this case.

The SC Johnson name on a product is a name people have trusted for $121$ years to stand for quality and excellence. Beginning in $1886$ as a parquet flooring company, SC Johnson soon earned a reputation for consumer$-$driven innovation through a product specially formulated to care for parquet floors Johnson's Prepared Paste Wax.

Over the years SC Johnson has expanded largely through acquisition. Today SC Johnson has $7$ product lines including car care, floor care, household cleaning, household scent, household food storage, household pest control and shoe care.

SC Johnson is a clear leader in the household mosquito repellent market with about $65\%$ market share. Muskol, the $2^{nd}$ largest competitor has about $15\%$ share. Muskol recently initiated a significant price reduction $(30\%)$ in an effort to gain market share. The annual growth rate for the Mosquito repellent market is $15\%.$

In $2013$ SC Johnson developed a new product. OFF! Clip$*$on ${?}^{TM}$ mosquito repellent is an innovative technology with proven protection against mosquitoes. Off Clip$-$on mosquito repellent is a personal, odorless mosquito repellent device that you can clip onto your belt, purse or pants, providing head$-$totoe protection from mosquitoes without spraying anything on your skin. It's the perfect way to enjoy personal time outside, such as hiking, gardening, reading or watching a sporting event.

OFF! Clip$*$on ${?}^{TM}$ currently sells for $$7\mathrm{.}99$ at retail. SC Johnson's marginal cost is $$3$ and they sell to retailers such as Walmart and Home Depot for $$4\mathrm{.}99.$ The Muskol competing brand sells for $$6\mathrm{.}99$ at retail. Market analysis has identified that the unique aspect of the new OFF! Clip on ${?}^{TM}$ has a positive differential value of $$2\mathrm{.}00$ per unit based on the significant reduction in the amount needed to protect a person each outing.

OFF! Clip $*$ On ${?}^{TM}$ is targeted at children and adults that are active and live in suburban and rural areas. There are $33\mathrm{.}5$ million Canadians, $47\%$ of these people live in suburban and rural areas. $70\%$ of these suburban and rural dwellers are active outdoors.

Prior to the product's introduction, SC Johnson completed a survey of buyer intentions with their target market and the results were: $43\%$ would definitely buy, $27\%$ would probably buy, and $20\%$ would likely not purchase. The survey also confirmed that $35\%$ of interested buyers intend to repeat their purchase with $6$ months.

Question $7($continued$)$

b$)$ For the OFFI Clip$*$on ${?}^{TM}$ product, calculate the market potential and sales forecast $($using the ATAR model$)$ based on the information provided in the case. Make sure you include your calculations for full marks. $(7$ marks with the split noted below$)$

ATAR Formula $=$ BU $($Market Potential$)*\%$ awareness $*\%$ trial $*\%$ availability $*\%$ repeat

Market Potential number $(2$ marks$)$

Sales Forecast number based on initial projected sales and $1$ repeat purchase cycle within $6$ months of launch date $(5$ marks$)$