Executive Summary

Mark Ellinas, CMO at PedalSpark, is facing a challenge on how to market the company’s new e-bike.
PedalSpark is introducing a cheaper entry level e-bike targeted at price sensitive customers. Mark
has to design a sales strategy for the new bike. He is struggling to choose between options to market
the bike directly through company’s website or use Amazon’s marketplace to reach out the
customers. His two direct reports Gideon and Tammar are have different views for both the options.
The time is less and Mark has to decide the strategy that would make the new bike sell well and also
protect the company’s interests.

Introduction

PedalSpark is a small manufacturer of high-end electric bicycles. It has successfully sold its flagship
bicycle, a $4000 premium model, directly to consumers through its own e-commerce website.
PedalSpark is now planning to launch a cheaper, $899 entry-level version to reach the price-sensitive
buyers. The CMO, Mark Ellinas, has to come up with a strategy for sales of new bicycle. He has to
determine whether the bicycle should be sold only via the website or through Amazon as well. Both
options have pros and cons.

In this situation, two opposing opinions were characterized by Mark's two direct reports. One,
Giddeon Bear (sales manager) prefers an aggressive approach to Amazon sales. The other, Tamar
Nourse (product manager) supports consumer marketing directly, to retain total ownership and
control of their sales process. Mark has to make a quick decision on the approach and submit the
action plan to his CEO.

Mark’s dilemma

Mark has been associated with PedalSpark for 2 years. He was earlier working with a children’s
bicycle maker, which used its won website for sales. Mark’s expertise helped PeddalSpark with its
first product sales. He is excited about the selling the new bike in an extremely crowded market but
the challenge is how to do it. Whether to use the Amazon as a new distribution channel or not?

Not very clear with his analysis, Mark reaches out to his two reports for their views. The first one,
Tamar Nourse, product manager, is strong supporter of selling it only via their own website. She
provides various downsides like threat of losing out, data security, poor brand management by
selling on Amazon. She provides facts and a case of her friend to Mark to make her suggestions
compelling.

The other one, Giddeon Bar, sales manager, is very aggressive on selling the bicycle through
Amazon. He shows a bigger picture to Mark, what Amazon can offer, and how their sales could
skyrocket if they chose Amazon. Mark cross questions Giddeon with his claims. However, Giddeon
provides strong arguments related to numbers, Amazon’s reach and an example of ‘Instant Pot’ to
Mark to support his claims.

At the end, Mark is perplexed of whether to signup with Amazon or not?

Giddeon’s Suggestions

Gideon Bear is showing the other side of the coin. He clearly points out that, although there is a
considerable risk, the payoff is also immense. He explains that there are already many e-bike sellers
on Amazon and so Amazon would be having lot of data on consumer behaviour and hence they are
already watching the market. Even if Amazon starts manufacturing their own e-bikes, it would be
years away.

Gideon offers more explanations for the relationship. He pointed out that Prime has 100 million
active subscribers. And of course, even if only a very small fraction of those members buy-sales are
going up dramatically for a small firm. Amazon provides logistics infrastructure and expertise to
exploit. He points out that PedalSpark can actually try as a test run with one of its goods. If it is
efficient and easy, then the options open up for other SKUs. Ultimately, Gideon also points out that
other well-known brands like Jimmy Choo, Apple etc. are also available on Amazon. He explains the
sales that Amazon could drive for them using the analogy of ‘Instant Pot’ example.

Tamar’s Suggestions

Tamar is a product person. She’s most concerned about the data security and the information that
Amazon would be getting from the sales of PadalSpark’s e-bikes. She mentions that "the day we put
the bike on sale Amazon will start vacuuming up information about our customers, our margins and
the market's potential. If it ever decides to get into the e-bike business, we'll have hand-delivered all
the data it needs to squash us."

She provides a strong example of how sales data was used by Amazon in her friend’s case. How
Amazon could use its proprietary brand Amazon Basics to sell similar products and throw the original
creator out of competition. She mentions that Amazon private labelling projection is to reach $25
Billion by 2022.In this respect, the online marketplace could become a source for competitors to
learn and copy. She is very apprehensive about the long term. She is of the opinion that selling on
Amazon will meet the short-term goals but in long run PedalSpark as a brand will be diluted from the
current impression that they have built among customers.

Available options:

To launch on Amazon To not launch on Amazon To launch on multiple sites

• Mark can launch the
bicycle on Amazon along
with the company's
website. This will give a
wide reach to
PadalSpark. As the
customer segemnt is
new , launching on
Amazon will provide
good targeting options.
• Mark can use the direct
to customer strategy and
sell via company's
website. This will ensure
the brand is not diluted
and customer exoerenice
is not hampered. Also,
this will help in builing a
stronger brand in the
long run.
• Mark can launch the
bicyclye on multiple
online marketplaces.
Relying just on Amazon is
not a better idea as
Amazon can spike the
rates and margin cut
anytime. Presence on
multiple sites will cover
this risk.
 Mark's Big Five Personality Assesment
Conscientousness

Extraversion Agreeableness

Openness to experience Emotional Stabitilty

Goddean's Big Five Personality Assesment

Conscientousness

Extraversion Agreeableness

Openness to experience Emotional Stabitilty

 Tamar's Big Five Personality Assesment
Conscientousness

Extraversion Agreeableness

Openness to experience Emotional Stabitilty