Risks analysis

Product risk

Our product’s distinctive characteristics can be summed up as “3Ss”:

 Style
 Size
 Strength

They present possible design problems in developing the structure and the
looks of our product, as well as successfully marrying the two. However, given
our team members’ experience, such problems are unlikely. Moreover, all bag
prototypes will be extensively tested under various conditions meeting or even
exceeding the real-life circumstances.

Market risk

The biggest market risk presents itself in the fact that we are developing a
product with a long lifetime which has to retain its attractiveness from a
fashion standpoint over this time. Changing the looks and style of our product
to match the evolving trends may cause it to lose its identity created during the
initial phase of intense marketing campaign and become less recognizable.

On the other hand, keeping the same base look largely unchanged in addition
to the product’s gain in popularity carries the danger of making it “passe” or
“uncool”, similar to the ubiquitous Crocs shoes. This is a tradeoff that has to be
considered carefully after conducting a deeper market analysis, and may force
us to change our target demographic from the primarily fashion-conscious to
the mainly comfort-conscious in the long run.

People risk

After the initial rollout phase we largely stop depending on the specialized
design skills of our team members. This creates a safe position regarding
possible unexpected departures from the project.
Financial risk

The marketing-reliant nature of our product leads to a risk in the form of

expensive marketing campaign. If, although unlikely, it was to fail, then it
becomes impossible to get any return from the investment and reshape it to
suit a new strategy (compared to more tangible investments such as the bags
themselves, sewing machines etc.).

The warranty policy also requires a careful consideration, since clumsy handling
of the claims and poor definition of the warranty terms can cause not only
financial losses, but alsoan irreversible damage to our bags’ image as a solid,
robust product.

Competitive risk

Although it is difficult to find on the store shelves exactly what we offer, some
competition may be present in the form of the popular IKEA bags, which are
also resilient and capacious. If the fashion characteristic is not emphasized
strong enough in the marketing and the product design itself, then it becomes
difficult to reach the customers which have been so far more or less satisfied
with the aforementioned bags.

Opportunities
The primary opportunity for our product is to establish a viral popularity. As
many as half of the consumers are driven to the purchase decision by word-of-
mouth marketing – our heavy investment into the cooperation with fashion
bloggers provides ample opportunity for our product “going viral”. The visual
nature of our product (size and design as two of the main selling points) also
makes it more likely that the customers will remember their encounters with
The BigBag .