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Please repond 101

Group A took a different strategy in many of the categories. First, throughout the simulation, Group A maintain its promotional allowances at 19.5% until period 7 to keep shelf space. In Period 7, promotion allowances were decreased to 15% to increase profit margins. Group B lowered its promotional allowances. Second, in most periods, Group raised its prices within industry averages relative to inflation rates. Group B made a mistake by reducing its price in period 3, which resulted in their stock price dropping. Third, Group A took a better approach at introducing a new product which gave us products in 3 (Cold, Cough, and Allergy category) Over The Counter Categories resulting in higher sales and net income. Group B only introduced two products in the cold category.

Group B had a better approach at targeting family segments. They felt that families were a key target in purchasing their products. Group A focused on targeting markets where we felt that we were falling behind in comparison to our competitors. In my view, Group B had a better approach than Group B since we had to change Allround and Allround+ strategy to all demographics.

Group A and Group B made advertising mistakes from the beginning. We could have seen better results by lowering our advertising budget since our brand was already established. It was not until period seven that we determined that if a brand has a high market-share (Allround), we can spend less on advertising. Throughout the simulation, we compared Allround to competitors, but there was no benefit since out product was competitive and selling.

Group A overall strategy was better than expected. We did not meet our target goals but achieved nice overall results. Our net income was about $908M, and Stock Price was $111.28. Our Group believes that an essential part of our overall success was cutting down on unnecessary advertising and focusing on maintaining promotional allowances generous and prosperous. Group A made right decision strategies, and for the most periods produced the outcomes that we expected. We realized the results of our strategies late in the simulation through trial and error.

Please respond 102

Team B took quite a different strategy in many areas than we did. One of the biggest areas we differed in was promotional allowances. In the beginning, Team B lowered promotional allowances while we increased them. We knew by increasing promotional allowances we were gaining important shelf space even though it was cutting into our net income. After first lowering promotional allowances, Team B realized that if they increased promotional allowance they saw an increase in shelf space which is one of the outcomes that they desired. We kept our promotional allowances at 19.5 % in all channels (until the last decision), expect for convenience stores which was at 15 %. Our average shelf space in period 0 was 1.2 and by period 7 we reached an average shelf space of 3.96, beating our competitors in all channels. Although Team B’s shelf space was less than ours at 3.03 by period 7, I think them keeping the promotional allowance lower (<19.5) helped them retain their net income. I think that we ended up keeping our promotional allowances too high during the whole game, losing net income in the process. Although gaining shelf space was important there was a middle ground that we missed and promotional allowances were part of the problem. By period 7 Team B’s net income was $855 million compared to Team A’s, which was $ 704. In the last period, combined with other adjustments we made, cutting everyone’s promotional allowances down to 15% we saw a net income that period of 204 million. Overall, Team B took a much better approach to promotional allowances.

I think we took a much better approach to the introduction of our new products. By the end of the game we had shares of the market in three of the four product categories: cold, cough, and allergy. Team B had two products, but they were mainly in the cold category. They had a 4-hr multi-symptom capsule and a 12-hr multi-capsule that targeted both cold and allergies, but was categorized with the cold products. Essentially one of their main competitors was themselves. For us, Allround+ was a cough medicine and although it did compete a little with Allround (cold medicine), our main competitors were in the cold category. If not for other mistakes we made with promotional allowances and advertising budget I think our net income would have been much higher. I think that our stock price increased to $111.28 because we had products in 3 of the 4 OTC medicine categories. I think these decisions would eventually lead to higher net incomes for Team A than Team B.