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1

Executive Summary ...................................................................................................................................... 2

Marketing Plan .............................................................................................................................................. 2

Uniqueness of Product .......................................................................................................................... 3

Benefits to Customers ........................................................................................................................... 4

Value Proposition.......................................................................................................................................... 5

Problems Identified ......................................................................................................................... 5

Current Market Situation ............................................................................................................................. 6

SWOT Analysis ............................................................................................................................... 8

Marketing Strategy ........................................................................................................................................ 9

Segmentation .................................................................................................................................... 9

Targeting ....................................................................................................................................... 10

Positioning ................................................................................................................................... 10

Marketing Mix ............................................................................................................................. 11

Product ....................................................................................................................... 11

Price ........................................................................................................................... 13

Promotion ................................................................................................................... 14

Placement .................................................................................................................... 16

Economies of Busines…………………………………………………………………………………….18

Revenue and Cost of goods Sold ................................................................................................... 18

Marketing and Distribution: ........................................................................................................... 19

Fixed And Variable Cost................................................................................................................ 19

Gross Margin and Net profit .......................................................................................................... 20

Return on Investment and Payback ................................................................................................... 20

Conclusion ................................................................................................................................................. 21

2

Executive Summary

The name of our company is Zzz Company and the product we are going to launch in the market

is the Electric Bed sheet Warmer. We named our company Zzz Company because Zzz is the

worldwide symbol of showing a person sleep. Since the aim of our product is to make the

consumers have a comfortable sleep then we can thus relate our logo to our product directly. The

concept of our company is that “No day is that bad that it can’t be fixed with a Nap”. That’s

where our company comes in with the objective of providing such a comfortable sleep that it

actually refreshes the people to have the energy to deal with their problems. The Product itself is

a Bed sheet with a Switch for Electricity which when is turned on then heats up the bed sheet to

provide warmth to the consumer sleeping over it.

Marketing Plan

For making this project a success, we have made a well-defined marketing plan. First step of our

marketing plan was to scan and analyze the situation around us. This gave us a general idea of

the overall market. Firstly, such a product did not exist in Pakistan. Secondly, we found out that

even though the product was unique but never the less it had to face competition. Given that the

product was a source of warmth so its substitutes like electric and gas heaters, coal, fire places

etc. Thirdly we then identified the goals for undertaking this project. Primary objective like any

other business is to make Profits. We have laid down quite a lot of stress on minimizing our costs

so as to make affordable and within range for our target market. The reason for this will be

elaborated in forth part of our marketing plan. Secondary goal of our company is to satisfy the

need that we have identified. The plan is to provide consumers with comfortable as well as a safe

product simultaneously. The actual purpose of attaining maximum consumer satisfaction is to

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take full benefit of first mover advantage. The idea is that as we are the first ones to make this

concept a reality in Pakistan, we intend to gain maximum consumer loyalty so that even when

our competitors try to copy our product, our consumers don’t switch away from us. Fourth part

of our marketing plan focuses on identification of our target audience. We identified that the

product is most likely to be bought by middle class and upper middle class income group. Lastly

we come to the final part of our marketing plan which is Budget cut. We have decided to allocate

a huge proportion to Advertisement. The reason being that as the good is new so we need to

create awareness among the masses about the product. Informative advertisement is necessary at

the introductory stage of our product.

Uniqueness of Product: Our business idea is such that we are planning to make a Bed sheet

which caters to the need of the consumers so that they don’t feel cold when they hop into

their bed. To achieve this we have introduced Electric Bed sheet Warmer. The product is

unique from all the substitutes available in the market. Firstly it runs on electricity and not

Gas or Coal so the shortage of these natural resources does not affect this product. Secondly

the product does not consume very high voltage of electricity and unlike other electricity

based heaters, it has a battery involved to deal with the problem of load shedding. Plus the

product can easily be run on generator and UPS due to its unique ability of running on very

low voltage i.e. 24V. Thirdly the idea is also very unique in this sense that most of our

substitutes are designed such that they warm the full room or hall depending on where they

are placed no matter how big or small the place is.

Benefits to Customer: The consumer expects quite a large amount of benefits from our

product. One of the most important benefits it requires is heating for obvious reasons because

if our product fails to heat up and provide the desired warmth to the potential consumer then

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it means the product is failing on the terms of performance. If a good is not able to perform

then it’s doomed to fail. Second expectation of consumers from our product is that it needs to

be safe. This is the point where consumer’s expectations as well as cautions are quite high as

they are highly concerned about this aspect of our product. The idea of sleeping on electric

wires is scary for them and they expect that this should be made as safe as possible so that a

tension free sleep can be ensured. Thirdly consumers also expect a low price as given the

target market is the middle and upper middle class so they also expect an incentive enough in

terms of price to buy our product instead of its substitutes. Lastly the consumers expect some

aesthetics as well. They want the bed sheet to be quite stylish and should be available in

multiple designs.

We are the first ones to be entering this market and hence have the first mover advantage. Next

we have carefully collected a lot of data from various consumers who tend to be from diverse

backgrounds and income groups so we have a customer oriented approach. Due to this reason we

have customized our product according to the majority of the consumer’s demands. By making

such a product that is approved by all the consumers, we intend to make sure that our product

does not fail. We have placed our products in Stores where it is convenient for consumers to buy

and its made sure that even in the furthest of all areas our product is available. Also we hoping to

cover geographical area of consumers up till northern parts and also consumers with diverse

needs are also targeted ranging from House hold to Hotel Usage.

The consumers were mostly interested in the safety of the product to insure this we took a few

steps. Firstly we have added extra sheets to the bed sheet so that the consumers don’t feel that

they are sleeping on a bunch of wires. The wires are at such a distance that the warmth of the

product can be felt but the physical feeling of the presence of the wires is nowhere near to be felt

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by the consumers while sleeping. Second of all that we have made sure that the product runs on

very low voltage. This means the consumers have no need to fear of high getting electric shocks

of high voltage from the product itself. Thirdly the material used in making the wires for the

product is such an insulator so that it prevents leakage. But even in case of any leakage of

electricity, the actual shock of the product does not reach the person using the bed sheet warmer.

Fourthly we have installed alarms so that in case of a fire the consumer wakes up and can take

necessary action. Lastly we have such a mechanism of fuses installed in the product that even if

the product faces a high or low voltage of electricity then in that case the fuse will trip avoiding

any possibility of accidents.

Value Proposition

My business has the first mover advantage as such a product with this high quality and luxurious

styles are not available in Pakistan. Further adding to it our product is going to be available in a

very large number of cities and areas. Thirdly such low price and such a product that consumes

minimum electricity yet delivers a high performance have yet again never been seen. Finally the

high investments done to ensure the product is safe also make it worth purchasing unlike our

unsafe alternatives. These all factors give us a unique selling point. Along with all these unique

features, our product is going to be available in different sizes according to the needs of the

consumers like single and double bed sheets. The product is not only suitable for household use

but also other markets like Hotels are also going to be targeted giving us an edge over all our

competitors in terms of wide consumer base.

Problems Identified: The biggest problem the customers raised was of safety. There have

been number of steps taken to solve these as already mentioned above. Except for this price

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also was sometimes raised as an issue because some customers instead of comparing our

product to heating appliances also compared it to traditional bed sheets. There opinion was so

that why will they buy such an expensive bed sheet. For this purpose we have lowered the

cost of our product by making our efficiency better so that lower price can be offered. This

also gives us a unique selling point as we are going to simultaneously target two markets of

heat sources as well as bed sheets.

Current Market Situation

Product Market is a place where goods and services are sold by companies and firms to

households and other consumers. The market for our product is Mattresses and Foam shops, high

end shopping malls, super stores and marts like hyper star, Al-Fateh and Metro etc. Market size

or the number of potential customers interested in our product belongs to the upper middle class

and the elite class of our country together which makes around 5% of the total population. The

needs and expectations of our consumers are as follow which were not being met with the

alternatives of our products

Warmth in cold nights

Comfortable Sleep

Low electricity bill

Safe to use / Waterproof

Easy to use

Easy to clean

Available throughout Pakistan

Available in different sizes

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Affordable Price

Warranty 1 year

Adjustable Temperature

Stylish and Trendy Bed Sheets

Some of the current market offerings, their details and prices are as follows:

Alternative Products Prices

Chinese Electric Bed sheet RS 3000

Electric Rod Rs 1000

Warmer Electric Heated Mattress pad Rs 4000

Heated Blanket Warmer Rs 3900

Gas Heater Rs 2000 to 3000

Electric Heater Rs 2500 to 3500

Our product has no direct competitors however in China there are some firms in the business of

bed sheet warmers so people can import it from China as well. Therefore, we don’t have any

strong competitor in the market of our country but some Chinese companies offer us slight

competition since their products are not of as such high quality as ours. Their products such as

electric heated warmers, heated mats, electric blankets etc. are in a very low price range of $5 to

$10. They have distributors online and doing their product’s promotion on internet (websites like

alibaba.com).

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SWOT Analysis:

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Marketing Strategy

Segmentation: Market segmentation is a marketing strategy that involves dividing diverse

and broad segments of market into subsets of consumers who have common needs and then

designing strategies and implementing them to target the potential customers. Segmentation

is done at different levels such as geographic segmentation, demographic segmentation,

psychographic segmentation and behavioral segmentation etc. For our product, we have done

the psychographic segmentation. In psychographic segmentation, buyers are grouped

according to variables such as social class, lifestyle and personality. Marketers infer and

research differences in the approaches of buyers to their products based on some elements of

these factors. In our case, the psychographic variables are social class and lifestyle. People

often express their lifestyle through the products and goods they consume. So, this sort of a

product shows the lifestyle of people belonging to the upper middle class and elite class. The

relevant social class for our product is the elite class and the upper middle class who includes

people such as managers, admins and professionals. While conducting the surveys, two

different markets were chosen: domestic who includes households, hostels and the other was

commercial which includes the hotels and hospitals. Some data was collected and the

following graph was plotted.

0%

20%

40%

60%

80%

100%

More than 6000

Price 5000-6000

Price 4000-5000

Price 3,000-4000

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This shows that People with income level less than 30,000, around 70% are of the

opinion that the price must be 30,000. The trend is almost the same in all income level. However

a slight deviation can be seen with the income level of more than 100,000. According to them the

affordable price can from 3000-5000.

Some of the homogeneous needs which are common in the segments relevant to us are:

warmth in winter season, comfortable sleep, low electricity bills and temperature controls etc.

Targeting: A target market is a group of customers towards which a firm decides to direct its

marketing efforts and strategy. For our product, the target market consists of customers from

the elite class and upper middle class. And among this target market, we are targeting the

households and high end commercial units. In the households, the interested customers are

the housewives and kids. Moreover, another market may also be the hostels of different

universities and colleges. Apart from this, we are also targeting high end commercial units

such as hotels and hospitals. The size of the target market is just 5% because both elite class

and upper middle class together make just 5% of total population. The growth rate for this

targeted segment is very low keeping in mind the current economic situation of our country

where more than half of the population is below the poverty line. The targeted segment is

measureable and accessible to marketing and communication efforts.

Positioning: Positioning statement is a statement which sums up the product name, its

purpose, the benefits offered, point of differentiation, targeted customers and the relevant

segment. For our product, the positioning statement is as follows:

“For every household, ZZZ comfort brings you electric bed sheet warmers, an escape

from extreme cold in a safe, comfortable and elegant manner.”

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The following diagram shows the perceptual map:

This map depicts that our product is of high quality and we are charging a moderate price

as compared to our competitors, who are mostly the Chinese firms, are manufacturing the same

product of very low quality and selling it at a very low price.

Marketing Mix

Product: Electric bed sheet warmer by “Z-comfort” is a product for the customers which is the

result of rigorous research on the field and off the field. The nature of the product is such that its

core attributes highlight the idea id comfortable and carefree sleep. The actual product that is

built around this idea is a bed sheet warmer that provides a warm bed in a cold winter night with

a regulated temperature, low voltage and cost. Our product specifications are:

Non hazardous low temperature (safe and warm)

Automatic temperature regulator

No bulky wires

Rechargeable battery

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Water proof

Available in all colors and patterns

Available in all sizes

When conceptualizing the actual product, we needed customer insight of how they felt about

sleeping in an electric bed sheet warmer. In the interviews various concerns emerged such as the

idea of sleeping on a bed of wires, safety issues as it is connected to electricity while a person is

sleeping and one of the interviewees said:

“No matter how safe you make your product” I will never buy it. (Malik Family)

The concerns of the qualitative interviews were addressed in our product by adding safety

precautions as mentioned in the specifications and adding foaming layers to avoid the contact of

wires and the sheet. It is also paired with an automatic shutdown mechanism in case of

overheating of the product or any damage in its operations. The products features were then rated

and dealt with as specified by the consumers. Their importance was stressed upon.

As rated by the consumers in the surveys, the features that consumers were most concerned

about:

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This shows that electric bed sheet warmer has a customer driven product design that

improvised its concept and flexed it according to the needs of the customers. The product that “Z

comfort” is selling is a shopping good, in which customer insight becomes primary as consumers

view such good as an investment for the future. It will be launched in its introductory stage

where the only interaction it has had with its target market is through interviews and surveys. “Z

comfort” hence faces a challenge to not only make a place in the market but also grow

exponentially in its returns to prove profitable for the business.

Price: The product we sell is a symbol of lifestyle and high income, it targets customers in the

elite and high middle class who want to make their sleeping experience a little more than it is in

winters. In lieu of the gas shortage faced in Pakistan, our product becomes a luxury for those

who can afford it as it provides a comfortable winter sleep. Z comfort, sees its product to be

priced around Rs. 4500, it is to be sold at a premium price given the cost of researching and the

special customer feedback that was turned into attributes and added in the product. While

conducting the surveys, most of the consumers were willing to buy our product for 3000-5000,

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this distribution is with regards to income groups who selected the price they were willing to pay

for our product. The popular price ranges are shown in blue and orange. Given the high price

positioned by the consumer, we can see that our customer base is not very sensitive to high price;

the price is within their set range however a little higher. Moreover, the price of electric bed

sheet warmer is not catering to all types of segments but few. This makes the price range

relevant.

Now that the price has been decided, we must address the fact that Z comfort being a new

brand and company is launching a product keeping customer care in mind. Therefore, in the

introductory phase of the product we do not plan to offer any discounts to the customers due to

the exclusivity and nice of our target market. Also, providing discounts kills the purpose of

charging premium price for our product. Since our product will be available at retail stores, we

expect cash payment methods for our product.

Promotion: Our tagline “Reminding you the comfortable sleep in your mother’s lap” will break

through the clutter to get attention of females, in specific, who are the main decision makers

regarding bedding products. Also, it will attract all the people willing to make their life more

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comfortable by adding a product that will provide them comfortable sleep in cold weather. Our

message is basically to beat the cold in a safe, comfortable and elegant manner by using our bed-

sheet warmer which will be delivered by two main media types: TV ads and Billboard

advertising. This decision was taken after analyzing our survey results. In our survey, 51% of the

customers rated TV as the medium providing most of the information regarding bedding product

while 14% rated billboards as the best medium for our product.

Though we will also be using print ads but on a very small level allocating a small budget

relative to TVCs and billboards. We also hope that our product will be promoted by word of

mouth which was highlighted by our potential customers in our survey results. Also we will be

portraying an image of elite lifestyle in our commercials in order to get attention of elite and high

middle class. This can be done by filming our ad in a way that would make sure to highlight elite

class home and elite class family. Also our ads will be elaborative enough to acknowledge our

potential consumers of the uses and features of our product.

We have allocated a handsome budget to advertising in order to make sure our message

gets delivered to the maximum potential customers. We will be spending Rs. 100,000 in 1st year,

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800,000 in 2nd year and then Rs. 500,000 for 3rd, 4th and 5th year. The reason for low budget in

the 1st year is the limited resources available as we will be spending a lot on equipment, office

and factory. Then in the 2nd year, we have increased our marketing budget to Rs. 800,000 so that

we could break through the market in our 2nd year. And afterwards, we have estimated our

budget to be fixed at Rs. 500,000 as many potential customers will have already heard our brand

name as the result of the efforts made in 2nd year.

This budget is also relatively low because of the reason that we will be advertising only

during the months of winter (from November to February). Also, the billboard advertising will

be mainly carried out only in the places of high prestige such as DHA, Model town and Gulberg

and the TV ads will be run mainly during the drama timings (8 pm – 9pm) in order to target

females but our TV ads in the 1st year will be very few because of the budget limitations which

will be increased substantially in the second year.

In order to analyze the buzz created in the market, we will try to engage our customers in

our product through the means of social media. Our social media team will be engaging with the

consumers by asking them about the features they like and dislike and other features they want in

the product. It will make sure our customers get a customer-based product having all the features

our customers want. And in order to invite our customer on our Facebook page, we will be

mentioning our Facebook page link on all of the advertisements.

Placement: We will be involving intermediaries as there is no need to establish our own stores

just to sell our product. This selling can be done in a better way through the use of already

established intermediaries which will save us cost of establishing separate stores. So we will be

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placing our product in Mattresses & Foam shops and in high-end shopping malls such as Metro

and Hyperstar. Also, our product must be placed in the mattresses shops located in the elite

shopping places like Y-Block in Lahore. The bases of this decision of ours are the results of the

surveys we conducted. 54% of our potential customers rated Mattresses and Foam shops as the

channel they would like to buy our product while 31% of the potential consumers rated for

Shopping malls as the suitable channel for our product. The basic idea is to provide our product

through the channels they already use frequently so that they might not have to travel a certain

distance for a product they have not used before.

We will not be selling our product online as consumers will not be willing to buy a bedding item

online which was also affirmed by our survey results but we will be providing be using social

media in order to engage with our consumers.

As far as the customer satisfaction is concerned regarding our retailers, we have chosen

only those retailers which already have a good reputation among our consumers i.e. shopping

malls. Also, we will be providing two different options to our customers to claim warranties

which will be through retailers or through direct contact with the company. But warranty

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services will only be provided in specific Mattresses and Foam retailers which will come to a

deal with us regarding warranty claims. And in order to contact us directly, they will have to

contact us on phone or online in order to fill warranty claim.

Economies of Business

Revenue and Cost of production: In estimating the cash flows and return from investment,

we need to estimate the cost of product and then the forecast sales and cash flow from that

product. To analyze the financial aspects of our product we have estimated that the final cost

of product is Rs.3800. This includes bed sheet material, network of coils and wire, remote

device and a 24V rechargeable battery. So based on this cost estimation, the suggested price

for the product that was decided was Rs.5500 in First year of operation. So at this price we are

assuming that we will be able to sell 500 units in year 2014 and then 1000,2000,3500,5000 in

next 4 years respectively. The projected sales and the cost of goods sold for next 5 years can

be seen from the graph.

1,900,000 3,800,0007,600,000

13,300,000

19,000,000

2,750,0005,700,000

12,400,000

23,800,000

37,500,000

0

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

2014 2015 2016 2017 2018

Revenue and COGS forcast

Cost of production Sales

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It can be clearly seen that as the product moves from adaptation stage to growth stage the

difference between yearly revenue and cost is increasing showing that the gross margin of the

product is increasing.

Distribution and Marketing: For Marketing of our project, the more focus will be on direct

selling by face to face or word of mouth. We also take the help of print advertisement which

will be circulated in the form of pamphlets and circular. So by using direct selling techniques

and print add, the cost of our product would be definitely lower. The graph shows the trend

between advertisement & marketing cost and total operating cost.

Fixed and Variable Cost: The major portion of manufacturing the product is variable while

small portion is fixed. The fixed include small rental payments and employees’ salary. So

this means that the investment is safer and in extremely bad days we are foresee the loss of

investment and at least we can breakeven.

100,000

800,000

500,000 500,000 500,000

1,248,000

2,025,000

1,809,000 1,901,0002,002,152

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2014 2015 2016 2017 2018

Advertiement and total expenses

Advertisemtn expenses Operating expenses

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Gross margin and net profit:

So it can be seen that net profit margin is improving showing that with the passage of time our

administrative and operating cost is decreasing which implies that we are achieving economies

of scale.

Return on Investment and payback period: When the future cash flow was estimated

based on Pro Forma statement and discounted on cost of capital the net present value of

investment that was came out was Rs. 1,850,275.80 and the IRR was 30%. This shows a

healthy return on our initial investment meaning that we will be able to get 30% return on our

investment for 5 year. So based on these cash flows the payback period was estimated to be

around 3 years and 10 months. This shows that investment will be recover in around 4 years

and remaining cash flows for next years will be our return.

850,000 1,900,0004,800,000

10,500,000

18,500,000

-262,690 -82,500

1,973,928

5,675,129

10,880,580

0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

2014 2015 2016 2017 2018

Axi

s Ti

tle

Axis Title

Gross Margins and Net Profits

Gross Margin Net profit

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Conclusion:

The above analysis proves to be a comprehensive account on a new product that is very

relevant in the Pakistani context. Not only is the electric bed sheet a convenience product but

it is also an innovation in the declining industry of Pakistan, where basic utility shortages are

making daily life difficult. It proves to be an effective product from all the stakeholders point

of view as per our “economics of business” analysis. Electric bed sheet warmer by Zzz

comfort is the product for any consumer who wishes for a comfortable sleep in extreme

winter. Our future plans include expansion in the commercial sector i.e. hospitals and schools

as discussed in our midterm presentation during the secondary research phase.