Marketing Simulation

Syndicate 5
Colour :Grey (Universe 1)
Company :Star Mobile Limited
Syndicate Members :
Name

PRN

Aditya Yerunkar

13020541001

Atika Singh

13020541006

Parth Shah

13020541031

Prashant Dudhe

13020541034

Saurabh Sonawane

13020541050

Vinni Panchal

13020541067

Star Mobile Limited

we give you what you want...

Vision
Garnering novelty, stepping towards
future

Mission
Build great mobile products to meet the
public demand in the most appropriate
and sustainable manner

9/8/15

Symbiosis Institute of Telecom Management

Market Data Trending

Tickers
Share
Price

Round
5

53.55
(1st
Position)

Round
9
50000

75
(2nd
46036
Position)

Total Equity
(k)

175577.9
(1st Position)

No. of
products

Asi
a

Europe

Market
Share(%)

Asia

ROI(%)

Europ
e

25.80
16
(2ndPos) (3rdPos
)

7.9
(3rd
position)

396805.4
6
6
16.54
19.80
4.4
st
nd
nd
Higher
(1 Position)
(2
Pos)
%
(2
Star Mobile
(1stPos
Position)in
investment
Star
Mobile
45000
has the
) R&D led to low
Ltd is the
40000
most cost
profitability
largest
35000 32250
effective
ratio and the
30000
investor
production
Round
25000
share price had
in R&D
compared
1-5
20000
sluggish growth
from the
to other
15000
compared to
initial
competitors
10000
Production
Competitors after
round 1-5.
stage. Capacity of
.
5000
Round 9
0
Star
Omniscie
Lien
R & D investments (k)
Mobiles
nt
MobiTec Orang Mobile Gree
Limited
Mobiles
h
e
s
n
9/8/15
Symbiosis
of Telecom
Management
3
100
% Institute
84.6%
85.9%
88% 93%
95

Porters Strategy
Cost Leadership
Trying to keep lower price of models than competitor and win market share
Responsible for creating price-war
Necessity : Skills in marketing
Drawback : Future depends on cost of the product
Our price in 1st round:

Product

Market

Price

Orion

Europe

299

Nave

Asia

199

Product

Market

Price

Orion

Europe/Asia

330/300

Euphoric

Europe/Asia

239/229

Nave

Europe/Asia

159/149

Our price in last round:

Most of our competitors prices were in range of 300

9/8/15

Symbiosis Institute of Telecom Management

Strategy (Round 6 to Round 9)

Round

Strategy

Mistakes

Outcome

Round 5

1. Focused more on Asian Market

Didnt focus much on

European market

1. 1. High market
share in Asia
(25%)

2. Invested heavily (10 to 15% of

revenue) in advertising

2. 2. Only 16%
market share in
Europe
Round 6

1. Launched a new product

(Feature phone) to capture
European market

Invested more than

required in channel
investment

2. Invested more on channel

distribution and
advertisement to increase
sales
Round 7

1. Reduced price of our products

to maintain cost leadership

2. 2. Operating profit
in Europe
increased to 12%
Invested less in R & D
as compared to
competitors

2. Included more features in our

low performing products

9/8/15

1. 1. New product
was huge success
& recorded high
sales (441 k units)

Symbiosis Institute of Telecom Management

1. Earned highest
profit for the
round
2. Less compactness
and battery life
3. More variable cost
(because low
5
R&D)

Strategy (Round 6 to Round 9)

Round

Strategy

Mistake

Outcome

Round 8

1. Invested heavily in R & D

Less number of
products in portfolio
to capture the market

1. Operating profit
(EBIT) reduced
from 8% to 6%

2. Tried to increase the

contribution margin by not
increasing the features of the
phone and reducing the unit
cost

Round 9

1. Increased our product

portfolio by launching same
product in both the markets

2. Compactness and
battery life
increased due to
investment in
R&D
Invested more than
required in R&D
(considering this was
the last round)

2. Tried to earn profit by gaining

market share not by
increasing margins

9/8/15

Symbiosis Institute of Telecom Management

1. Share price
increased to 75
2. Having maximum
Equity, Cash and
cash equivalent

Financial Outcomes
BALANCE SHEET, k
Total Assets

Round 6
313496.6

Round 7
364575.8

Round 8
428533.1

Total Equity 241516.8 299601.8 351553.7

Total
Liabilities
71979.81 64974.04 76979.37
Total
Liabilities and
INCOME STATEMENT, k
Equity
313496.6 364575.8 428533.1
Round 6 Round 7
Round 8
Total sales
1010614 913696.1 1020717.9
Total Variable
cost
749662.6 690045.7 823755.69
Contribution
Margin
260951.3 223650.4
Total fixed costs 172047.7 149711.4
EBIT
88903.68 73938.98
Interest income
EBT
Direct income
taxes
9/8/15
Profit

3967.97 7870.953
92871.65 81809.93

Round 9
472240.5
396805.4
75435.16
472240.5
Round 9
1018805.7
809010.9

196962.2
133410.6
63551.65

209794.7
160893.5
48901.25

9620.017
73171.66

14833.51
63734.76

Costing
Forecasting method
for
sales
was
accurate.
Conservative costing
helped to manage
noticeable profits.
Whereas profits of
the competitors were
unstable because of
the weak costing.
Here, we have done
some
analysis
to
invest in R&D, and
created a formula for
getting
desirable
outputs.
Microsoft Excel analysis and formula - R&D.spv
Worksheet

26932.78 23724.88
21219.78
18483.08
Symbiosis Institute
of Telecom
Management
65938.87 58085.05 51951.88 45251.68

Low

Growth Rate

High

BCG Model
Stars
Question Marks

Nave(Mkt Share :
6.5%)
Nave007(Mkt Share :
3.6%)

Cash Cows

Corpus(Mkt Share :
2.1%)
Euphoric(Mkt Share :
2.1%)

High
9/8/15

Product 4(Mkt Share :

2.2%)

Dogs

Orion(Mkt Share :1%)

Market Share

Low

Symbiosis Institute of Telecom Management

Product Life Cycle Orion

600
500

494.06

400

518.97

364.74

360.39

352.92

300

304.52

285.76
225.34

200
100

Sales in '000(units)
Polynomial (Sales in
Trend Line
'000(units))
Polynomial Curve
for Sales

64.5

0
0

10

Round
Number

PLC
Stage

Description

Sales (000
Units)

1,2

Introducti
on

Orion launched in Europe

R1 :64.5
R2 :225.4

3,4

Growth

Best selling product in Europe.

Launched in Asia

R3 :352.92
R4 :494.06

5,6

Maturity

Received very good response in

both markets

R5 :518.97
R6 :360.39

7,8,9

Decline

Because of Price-Wars sales

started falling rapidly and
contribution margin reduced
drastically.

R7 :285.76
R8 :367.74
R9 :304.52

9/8/15

Symbiosis Institute of Telecom Management

Thank You

9/8/15

Symbiosis Institute of Telecom

Management

10