xcalibur
William Johnson
Eduardo Kamisato
Barbara Mulvenna
The Might of Markland
The Road To Success
Starting Position
Strengths
 Initial Market Placement
 High Brand Awareness in Key Market Segments
– Singles and Others
 Initial evaluation tools
– Brand awareness
– Purchase Intention
– Market Share based on Unit sales
Initial Indicators
 SECT
 SELL
BRAND AWARENESS
Buffs
Singles
Pros
Highs
Others
Total
47%
67%
39%
38%
71%
55%
PURCHASE INTENTIONS
Buffs
Singles
Pros
Highs
Others
Total
5%
12%
0%
1%
29%
11%
MARKET SHARES
Based On Units
Buffs
4%
Singles
11%
Pros
0%
Highs
1%
Others
29%
Total
12%
BRAND AWARENESS
Buffs
Singles
Pros
Highs
Others
Total
64%
76%
54%
53%
47%
58%
PURCHASE INTENTIONS
Buffs
Singles
Pros
Highs
Others
Total
8%
26%
2%
3%
6%
9%
MARKET SHARES
Based On Units
Buffs
7%
Singles
26%
Pros
2%
Highs
3%
Others
5%
Total
8%
Weaknesses




Small Overall Market Share
Low Product Volume
Inferior Products (low Power)
Small Budget
The company’s strong initial positioning
will overcome its shortcomings.
Objectives
Initial Objectives
 Growth in Singles of 24%
 Growth in Others of 19%
 Large potential in these markets.
 Cumulative growth 226% and 135%, respectively.
 Greatest potential off all market segments.
 If Excalibur merely maintains its market share, it can
achieve an estimated growth rate of 177% over five
periods.
Evolving Objectives
 Sequential market entry
– Singles, Others, Pros, Buffs, High Earners
 Full product portfolio
 Contrarian strategy
Successes
 Excalibur did maintain its market share in the key
segments discussed.
 In the Others and Singles markets, Excalibur had
market shares of 33% and 35%, respectively in period
6.
 This resulted in cumulative growth (on a unit basis) of
302% and 196% in the Singles and Others markets.
 The net growth in unit sales of Excalibur by period 6
was 251%, even better than the projected value of
177%
Successes (continued)
• Broad product offering
– Range of portfolio products
– Large price range
• Overwhelming presence in Sonite market
• Leadership position in all markets
Setbacks
 Too much focus on market share in terms of units sold.
 Not looking for the market share in terms of dollars.
 Failed to deploy strong individual brand management.
 Lower profit margins.
 Using advertising to seek market share, ignoring the
importance of profitability of each brand.
Setbacks (continued)
 Neglected to use the advertising experiment and the sales
force experiment surveys in an efficient manner until the
last four rounds.
 Overspending in advertising and neglecting the distribution
channels.
 Flanking strategy was not efficient.
 Needed to aim directly to target markets with exact
product.
 Using one brand to serve two market segments.
Key Factors
Driving Demand
Factors Driving Demand
Growth
 Growth in Singles and Others Population
 Changing market needs
– Higher power needs
– Changing pricing
– Product obsolescence
 Advertising
Competitive
Barriers
Competitive Conditions
 Market entrenchment
– Over-crowded market segments
 Lack of distribution channel coverage
 High R&D costs to innovate
– Low budget of Excalibur caused disadvantage
 High market introduction costs
– Advertising
– Distribution
Expanding
Market
Share
Starting Position
 Excalibur began as the smallest company in the Samurai
industry.
 Its sales were less than half of the first company and 10%
smaller than the fourth company.
 Low power products only nominally met the needs of the
market.
Current Position
 Excalibur now has the second largest dollar sales of
sonites and the largest unit sales of sonites.
 Excellent progress was made resulting in substantial
growth in sales, product lines, and profitability.
 The executives of Excalibur have left the company with
products in every major sonite market segment.
 All market segments are dominated by Excalibur.
Advantage
Companies leaving the sonites market to focus
on the vodite market gave Excalibur an
opportunity to excel in its core competency.
Products
Portfolio
SONITE MARKET
BRAND COST* RETAIL*
LIFE
$
$
PERIODS
SECT 52
210
0-5 DISC.
UNITS SOLD
CONT. AFTER MKT
K$
322,000
16,616
SELL
99
340
0-7 DISC.
590,000
52,315
SEXY
SEXT
SEPT
SEBU
SEHE
113
155
155
260
260
330
320
430
401
519
3-PRES.
5-PRES.
5-PRES.
8-PRES.
8-PRES.
1184000
813,000
240,000
42,000
17,000
86297
70,286
19,452
-4,747
-3,248
TOTAL
3,208,000
236,971
SEGMENT TARGET
52 OTHERS
ORIGINALLY SINGLESREPOSITIONED TO
89 TARGET OTHERS
ORIGINALLY SINGLESREPOSITIONED TO
73 TARGET OTHERS
86 SINGLES
81 PROFESSIONALS
-113 BUFF
-191 HIGH EARNERS
74
Enhancing Future
Market Position
Recommendations
 Reduce costs of SEBU and SEHE
– Improve margins
 Introduce new Singles product
– Higher power product needed
 Enter vodite market
– Wait for some market stabilization
– Focus on followers segment
Effectiveness
of
Excalibur
Management
Initial roles
 Specialization within Excalibur accelerated over time.
 Occurring as it became obvious that there was no time for
the group to make all decisions by committee.
 Building trust among the individual members played an
important role in later decision processes.
 As the complexity of the data and the decisions grew, it was
necessary to specialize, each individual contributing what
was needed for the group to succeed.
 By period 9, the activities of any one member could not
have easily been duplicated by any other member.
xcalibur
What We
Learned
Conclusions
 Focus on profits not market share
 Focus on overall strategy
– Not on individual product performance
– Not individual market segments
 Think big
– Not just where you are now
 Learn from your mistakes
– Be flexible
– Change your strategies as necessary