Marketing Management-I

(Group Assignment)

Submitted to:

Prof. Manoj Motiani

Submitted by: Group 4, Section: E

Aditya Chowdhury 2021PGP015

Borse Shivani Satish 2021PGPH003

Rohit R 2021PGP296

Shikha Chaudhary 2021PGP558

Supreet Mohanty 2021PGP540

Vijeta Mariwalla 2021PGP429

"Barco Projection System (A)" case
analysis 
Problem Statement
The 1270 “superdata projector” introduced by Sony was better than BPS’s highest
performing model which threatened its reputation for superior quality products.
Additionally, it was also cheaper impacting sales and BPS stood to lose around 70% of
its forecasted 1990 profits. Sony was planning to roll out the 1270 in markets from which
BPS got its majority revenue which threatened their market share. Dealer confidence in
BPS was lowered due to the announcement of a better, cheaper model. BPS was
unable to anticipate this move by Sony and they needed to catch up by making
significant changes in little time.

Situational Analysis
The SWOT framework has been used for Situational Analysis in this case.

Strengths

BPS has a strong focus on R&D and it is a market leader in electronics able to achieve
better results than competitors using the same lens and tubes. BPS has a niche
marketing strategy focussed on becoming leaders in segmented markets like the
graphics sector of projector industry. BPS products are compatible with most computers
and they are constantly innovating.

Weakness

BPS has not innovated in graphics projectors in the last 2 years showing complacence
in its products. It was also not aware of its competitor’s activities which highlights
insufficient market information.

It’s biggest weakness however is the dependence on Sony Components, a division of

Sony for tubes, an essential component of projectors.

Opportunities

The demand for industrial projection will at least remain for the coming 5 years and will
be complemented by demand for better computers. BPS’s opportunity is in constantly
innovating using its R&D resources while being competitive in price.
Threats

The introduction of the 1270 which is better and cheaper than BPS’s highest performing
product threatens its profits. Additionally, there is distributor pressure to reduce prices or
risk reduction in sales volume.

Options Available
The options available for BPS are as follows -

1. Review and reduce the price of the BG400 after Sony’s 1270 launch to minimize
profit reduction and loss of market share.

2. Do nothing and pursue development of the BD700 as planned and then go for
the BG800 in late 1990

3. Scrap plans for BD700 and dedicate all resources to developing BG800 to
surpass the performance of Sony’s 1270.

4. Allow market share erosion by trying to expand to other emerging markets.

Additionally, improve market penetration by improving the box-dealer network
and making products more user friendly to increase sales volume and reduce
prices. 

Decision Criteria
Profit Reduction

Decision needs to be made based on the alternative that reduces profit margin the least
for BPS. This is because it has been mentioned in the case study that BPS cannot win a
price war against Sony. Reduction in price to compete with Sony might eat into BPS’s
profits more than the market share reduction at BPS’s existing prices. 

Product Quality

Any new product launched by BPS will have to be able to compete with Sony’s 1270 in
terms of performance.
Timing

The unanticipated move by Sony has put BPS in a tight spot. The ideal option should be
a response to whatever move Sony makes and hence timing is very crucial.
Responding early by reducing prices might eat away at its profits whereas responding
late might hurt BPS’s market share.

Market Response/Reputation

BPS has a reputation for creating superior products. Dealers also prefer selling BPS
projectors even though Sony offers higher volume because of the higher margin. The
decision has to be made such that dealers and patrons of BPS products don’t stop
favouring BPS products. Also, dealers play a major role in keeping the street prices low.
BPS should see this as an opportunity to improve its existing network of box-dealers.

My Decision
Stopping work on BD700 and dedicating all resources to BG800 is the most optimal
decision for the company because BPS cannot win a price war against Sony so
reducing the price of the BD700 or BG400 is not optimal and will reduce profits.

However, the BG800 is superior to the 1270 and can compete with it in terms of quality
and price.

There is a 40% chance of meeting the Infocomm deadline which is worth a try.

BPS operates in a niche market with dealers making higher margins from superior
products. Introduction of the BG800 will maintain the company’s reputation.

Trade Offs
The major trade offs are as follows -

1. Employees have been working overtime for BD700 since mid-summer.

Scrapping the project might affect morale

2. The short deadline might affect final product quality

3. Pre-orders on BD700 will have to be dealt with incentives so that customers

morale is not affected.
 4. There is a 60% chance of not making the Infocomm deadline in which case it
won’t be very effective and marketing the new product would be a hassle.

5. Without alternate supplier for lens, BG800 will not be ready on time

6. Basing decisions on rumours and speculations about the 1270 is not good
marketing practice

Backup
BPS will have to take a calculated risk in this situation.

If it’s not able to deliver the BG800 before Infocomm, it should allocate sufficient
resources to launch the BD700 on-time. Since BPS already has pre-orders from its
customers for the BD700, it can deliver those orders and earn back the opportunity cost
it lost while putting BD700 on the back-burner.

Additionally, it can offer customers the option to replace the BD700 with the BG800 by
paying the difference along with a small margin. It can also allow market erosion and try
to compensate for the same by venturing into emerging markets where Sony is not a
huge competition.

Additionally, it should keep on working on the BG800 but postpone the launch. While
the Infocomm deadline would be missed, BPS can arrange another trade-show or adopt
marketing strategies to sell the BG800 once it comes out.

Also, it can invest this time to build up its distribution and dealer network which will
reduce the street price of BG800 upon launch. The focus while expanding the network
should be on adding more and more “box-dealers” since the BG800 is expected to be
user-friendly which is an advantage to consumers and dealers.