Exploitation Strategy and Plan
The purpose of this document
The purpose of this document is to make sure that at the end of the research the designed
tool is known in the relevant industries, there is enough information to encourage the
exploitation and there are methods recommended to the research participants how to
introduce the product to the market.
Exploitation of the research results is an important part of the project responsibilities and
an area of activity that requires a professional marketing approach to ensure success.
This document condenses relevant marketing techniques into a short guide, such that
when followed by the consortium will deliver an appropriate marketing plan.
Section 1 – Exploitation Strategy
Business Definition
It is important to define the purpose of the business, to set boundaries of business effort
and to have a starting point for strategy development. Business definition is often
regarded as the foundation of strategy as it helps organizations to focus on their core
objective. To help portray the business definition as set of choices it is common to
examine it along four dimensions:
1. Customer needs. To satisfy customers’ need by offering them the right product or
problem solving packages.
2. Customer segments. To identify different group of needs and choose target markets.
3. Technology. To describe the way that the target customers’ need can be satisfied.
4. Value-added activities. To determine how far toward the end customer or backward
to the raw materials and components should the business participate.
Information Systems and Marketing Research
Obtaining relevant information about the market, analyzing, evaluating and distributing
them in accurate form in order to help decision makers to improve their marketing
activities. Many companies continuously develop their Marketing Information Systems
which involves internal reports system, marketing intelligence system, marketing
research system and analytical marketing system. Having the right information is
essential however finding the leverage point of being well informed and the cost of
detailed information gathering is also a key to market success.
SWOT Analyses and Analyzing Competitors
Applying SWOT analyses on its own organization and on the competitors organization
will permit the company to refine its own strategy and to take advantage of the
competitor limitations while avoiding engagement where the competitor is strong.
Created by Katalin Eibel-Spanyi
1
Strategy Decision Making
Strategies are highly dependent on whether the company is a market leader, challenger,
follower or nicher.
Pricing Strategies
There are six steps companies usually follow to set the price of a product.
1. Establishing the company’s marketing objective such as survival, maximum current
profit, maximum current revenue, maximum sales growth, maximum market
skimming or product-quality leadership.
2. Determining the demand schedule.
3. Estimating cost variation according to different output levels.
4. Analyzing competitors’ prices as a basis for positioning its own price.
5. Selecting a pricing method: markup pricing, target return pricing, perceived-value
pricing, going-rate pricing, sealed-bid pricing.
6. Determining the final price.
Marketing Channels
Marketing channel decisions are complex; each channel system creates a different level
of sales and costs. The chosen channel will significantly affect and be affected by the
other elements in the marketing mix.
Promotion Mix
Business promotion tools include conventions and trade shows. Sales promotion covers a
wide variety of short-term incentive tools designed to stimulate the consumer markets,
the trade and the organization’s own sales force. Public Relations has great potential for
building awareness and preference in the marketplace and repositioning products. The
major PR tools are news, speeches, events, public service activities, written material,
audio-visual material, corporate identity media and telephone information services.
Evaluation
Evaluation is very important to make sure that the organization operates efficiently and
effectively. Many surprises occur during the implementation of plans and processes; that
is why continuous monitoring and controlling activities are requisite.
Section 2 – Exploitation Plan
Business Definition
Created by Katalin Eibel-Spanyi
2
1. Customer needs. To reduce dangerous, too hazardous and costly subsea activity and
to increase the resources available for exploitation through enabling operation at
greater depth and with advanced tools and tool systems.
2. Customer segments. The end users are industrial buyers and can be defined on the
following areas:
 A) Pipeline construction and maintenance
 B) Pipeline monitoring
 C) Oceanographic
 D) Nuclear decommissioning
 E) Oil and gas exploration – production
3. Technology. In order to meet the needs of target customers a new product has to be
designed. This document is a part of the research project which objective is to design
a remote control vehicle specially satisfying the above mentioned needs. Research
institutes, Universities and SMEs work together to find out the best solution and right
technology. In order to find out the specific needs of the industry several discussions
has been carried out and a questionnaire has been applied. Based on the gathered
information decision was made on features of the designed tool.
The vehicle is capable to do ……… kind of tasks in deep water up till ……… depth.
It contains three parts ……………… and …. (detailed information on what those
parts do)
It could connect to the existing robot arms and ………… through a custom designed
end tool. (GIVE A BRIEF TECHNICAL DESCRIPTION OF THE TOOL.)
4. Value-added activities. As the tool itself can have several applications depending on
the interface connecting to the tool, the interface design is a value-added activity
itself. On the other hand, as several different organisations work together in order to
achieve the research objectives, the work process itself is a value-added chain.
However it must be determined which organisation is responsible for production of
certain parts of the tool and which organisations are responsible for assemble after the
prototype has been tested and proved.
Production
In order to supply the market with products based on the research result prototype design
each SME has to agree on a its contribution in the production process. The assigned tasks
should match with the SMEs capabilities and should be the most effective way for
ensuring the production of the end product. There could be some areas where
subcontractors are required. Those areas should be defined in advance and arrangement
should be done.
Suggested role identification.
Created by Katalin Eibel-Spanyi
3
Smith Eng. – mechanical engineering production
Electo Information Systems (Zendiq)-Control system
Mundal-Composite material development production
Chelsee Instr. – assemble the complete product – subcontract parts for manufacturing–
distribution
Argus - has an interest in the total system for light ROV use.
Scotia Instrumentation – interest in total system for subsea pipeline connection
Patents resulting from the research – each SME is allocated patient rights (after joint
negotiation) and the above declared area of interest is used as a base for negotiation
between the partners.
Information Systems and Marketing Research
The research participants gathered lots of information and knowledge over the years they
have been dealing with similar businesses. The information was summarised, organised
and handed out at the kick off meeting. The participants keep contact with each other and
with the project manager who makes sure that the information flow is smooth and
effective. Every participant gets the quarterly progress reports which summarise the key
points and achievements.
Besides of the distance among participants the information is fast and accurate by using
modern communications technologies.
Several business meetings have been held and a formal questionnaire has been handed
out for marketing research purpose.
The different sources of information on demand need to be organised and kept on record
in order to have a database for distribution purpose.
SWOT Analyses and Analyzing Competitors
The partners in this research project work together to a common objective. However
these partners could be natural competitors. Therefore role determination and
confidentiality is very important and why a traditional SWOT analyses can be a
challenge.
We need to identify the different roles for the tool and then each partner to perform a
SWOT analysis. Strengths, Weaknesses, Opportunities and Threats.
Once each partner has completed his SWOT analysis we can jointly develop a common
analysis for the consortium.
Strategy Decision Making
Created by Katalin Eibel-Spanyi
4
The designed tool will be a unique tool, which would give a market leader position from
the product point of view. From the market point of view the product could be used in
different industrial niche market.
Price Determination
1. The objective is to make sure that after a successful prototype test, the product is
going to put on the market and the participating SMEs continue to generate revenue
from marketing the product.
2. Due to the highly specialised industrial use of the product, the demand determination
is a collaborative task for the participants. During the research project lots of
information is gathered and potential customers are kept on record though a brain
storming meeting is suggested to discover all the opportunities for marketing the
product.
3. Estimation cost variation according to different output levels. The designed ROV
contains three well determined parts. Two of those have constant costs and the third
has variable costs. Besides the production cost there is a research and design cost
from the SMEs side. This is their contribution to the research which resulted the end
product. Decision should make whether this part of the cost would be built in the
product price or not.
4. Making comparison in product capabilities and price of other existing/competing
products as a basis for positioning.
5. Selecting a pricing method. We suggest markup pricing.
6. Determining the final price. As the cost of two components fixed and the third varies
we would suggest to apply a multiplication table for concrete price determination.
The multiplication number would vary for the two fixed components according to the
market where the product would be sold. As the third component of the product
requires custom design, it is obvious that the cost would vary according to the
concrete application requirements. This means that the price consists one fixed part
according to the applied multiplication number on the specific market regarding the
two fixed components and one variable part regarding the custom design.
As there are different markets where the designed ROV could be used, it is advisable
to apply different multiplication numbers according to the market.
The multiplication number should be determined on that way that the cost of
production, distribution, promotion is covered and also that it contains reasonable
profit that is common in the relevant industry.
The next table is a suggestion for formulating the above describe price strategy.
Name
Cost
Pipeline
Pipeline
Oceanogr
Nuclear
Oil
and
Monitoring
Created by Katalin Eibel-Spanyi
5
Constr. &
mainten.
Interface
+
Body
Role/end
tool
aphic
Gas
Base
Variable
Patent agreement and price determination point 3., i.e. decision on research and design
cost, should take consideration.
Marketing Channels/Distribution
All the SME's are eligible for distribution of all the research results. However, early
discussions indicate an interest from both Chelsea Instruments and Argus in distrubution
of the total system for their own niche market areas.
The nature of the product determines the distribution method, which is industry-toindustry. Each selling requires technical specification and most of the cases some
modification. The seller and the buyer are most likely to go through lengthy discussion to
specify all the requirements involved in the sale due to the modularity of the tool.
The distribution is supported by a list of potential buyer and also by dissemination
activities. The dissemination activities are summarised in the Dissemination Strategy.
There is a list of Dissemination Activities from which we could gain potential buyer
contact details, a key role in this is the questionnaire survey that indisrectly identifies
potential customers.
Promotion
It is planned to give presentations and to publish in different magazines and papers
regarding the new designed tool and its capabilities. It is very important to find the most
appropriate magazines and papers in the industry. Each partner needs to provide a list of
suitable publications.
For the SME's they should identify local newspapers that might consider giving the
project some coverage. This would need to be sufficiently local coverage to the specific
partner to be of interest.
For the RTD performers they should identify conferences that might be suitable locations
for a presentation and identify specialist publications that might consider a write-up on
the project.
As the nature of the tool determines the buyers in the industrial area, we suggest the
business to business approach. This means that the main pipeline, oceanographic and
nuclear industry players have to be contacted personally and be familiarised with the
Created by Katalin Eibel-Spanyi
6
designed tool. For this purpose, it is suggested to design and print a brochure with
explanatory drawings and text. This brochure also can be used on trade fairs as a give
away information.
Trade fairs are another type of promotional activities and it is suggested to take part on
relevant trade shows to introduce the tool to the market.
It is also suggested to organise product introductory seminars where the end users can
gather information on ability of the designed tool and can discuss different application
needs.
Created by Katalin Eibel-Spanyi
7