Movvo: Marketing Location – Based Big Data
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[pic 1][pic 2]Movvo: Marketing Location – Based Big DataMarketing Management TCInstructor: Irene ConsiglioGrader: Maria Luísa Melo Gomes OliveiraOctober 2015ANA BEATRIZ DIAS | Nº 2519What are the most relevant criteria to use to segment the location-based big data market? How would you define these segments?Relatively to the location-based big data market one can enumerate the following relevant criteria, having in mind the proper characteristics of well-defined market segments:Types of prospective customers: definition of which kind of customers are willing to acquire this service as well as the exact number of potential targets – identify the types of industries that need the service, companies within those industries and the dimension of those companies (e.g. number of stores), with the aim to transform that raw data into instruments to measure the size of the market segment – Measurable.Market penetration feature analysis: hypothesis of aggregation having in mind the number of potential customers and market opportunity computation, as well as prospective sales/yearly revenue, conversion rate (i.e. number of prospective deals that actually turn into an effective contract) and growth margin – Substantial. Acessibility: Costs of entering the specific segment of the market as well as a strategy definition in order to enter that market and reach those customers. Might also include the time spent in order to convince the potential customer and close a specific deal – measures the response to the product – Accessible. Price sensitivity analysis: closely related to the willingness to pay for this kind of solution, regarding each market segment (could also translate the degree of urgent need perceived).Differentiation features Needs’ aggregation: based on the customer’s needs, the service provided will adjust to what a customer is searching for within the information provided by the system: simply crowd analysis, time spent in each area, layout improvement, count the number of people that enter a specific area, automatic ticket payment (e.g. transportation), among others. Various purposes and needs must be identified for prospective customers to be properly aggregated – having that specific need in common (homogeneity), that clearly identifies the segment and distinguishes it from the others (heterogeneity). – Differentiable. Value/selling proposition: it is necessary for Movvo to clearly define its value proposition regarding the quality, cost and effectiveness of the service provided, therefore adjusted to each segment’s needs. After conducting a clear aggregation of potential customers based on their needs as well as the way the product is perceived by them, it is important to define the specific approach to each segment– Actionable.An additional note should be addressed to the geographical segmentation, as Movvo has already identified the US and European markets as targets to market penetration.
It is then possible to distinguish the following segments, regarding business characteristics and different needs that could be satisfied with the acquisition of the product:Retailers Food Retailers (Fast Moving Consumer Goods) & Apparel RetailersIn terms of value proposition, this segment has a clear one, as Movvo wanted to give bricks and mortar retailers access to the same type of intelligence used by online competitors (e.g. Amazon), in terms of customer’s data. Analysing the prospective customers, there is a high number of potential targets – the world’s top 250 retailers only, have, on average, 1000 stores. However, retailers are not that receptive to the product once they are already facing a problem of “data exhaustion” and would therefore be harder to convince (5% conversion rate estimation).Malls/OutletsMovvo’s intention regarding this segment would be essentially to provide an instrument of management support to malls’ managers. Through the analysis and evaluation of shopper’s behaviour, the main goals would be to: maximize real estate value; maximize the effectiveness of marketing efforts; optimize store mix; maximize rental income and optimize shopper experience. Relatively to competition, Movvo has a clear competitive advantage within this specific market, being cheaper to clients than competitors. Additionally, Movvo’s service quality in movement/positioning detection (higher precision, with a minor error) would clearly contribute to increase its market share in what concerns to malls, that are actually receptive to this kind of technology and find it useful, as they have been collecting this data manually and have a higher willingness to pay, when compared with retailers. This segment registers a high market opportunity for either the US or the European market, with potential yearly sales of €183 (in addition to €55 million on outlets) and €172 million, respectively. However, the competition within this market is ferocious, what can directly influence the conversion rate: prospectively 1/10 in the US and 1/20 in Europe. Transport and Mobility Transport companiesThe value perceived by this segment on Movvo’s techonolgy is aligned with the strong interest in soft security systems capable of helping monitor crowds and allow for routing people and manage crowd flow. Movvo’s offer for transportation companies would be based on actionable analytics regarding effective passenger use of their services. It would then be easier for companies to seek fair compensation based on real usage as well as follow the trend and switch to electronic validation methods – automatic ticket payment based on a simple and user-friendly service, characterized by an error-proof system with low support requirements. This market’s opportunity would potentially be higher than $60 million in the US and $120 million in Europe[1].