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C TGDirect Marketing Plan
MARK 1107 Fall 2015
Professor: Boucher, Laurence
Class: Wednesday, 8 a.m
Killner, Cynthia
Makei, Dmytro
Sytnyk, Iryna
Torres, Edgardo
Version #2
November 24th
2015
2
1. Background situation analysis
Car sharing is increasing in popularity in most cities of Canada such as Toronto and Montreal. The market is attracting
competitors from traditional car rental services and new entrants. COTG has been expanding its market share in these two
major cities in about 30%.
Key market facts forecast for 2016:1
 Car sharing industry will replace 3.38 million private car
 Car sharing industry expects more than 15 million members
 Fleet will involve 260,000 vehicles
Taking all into account car sharing has substantial cost-effective advantage over other transportation methods comprising
carpooling, says one of the automotive analysts from TrendForce.
Research shows there were 46 car sharing operators in the U.S., Canada, and Mexico serving approximately a million
active members, with a combined fleet of almost 16.000 vehicles. Interpolating these stats, we can estimate that in Canada
there are 3 service providers with more than 1,120 vehicles.
After the acquisition of Zipcar by AvisBudget Group, it became one of the biggest car-sharing providers in the world.
Currently, AvisBudget represents 79% of the rental car market and 63% of car sharing market in North America.2
In Canada, AvisBudget Group represents 9% and 11% respectively.
In Canada, car sharing is mainly used by millennials. The top reasons to share are work related purposes as well as
business meetings and personal use.
Competition and opportunities:
The majority of the market is ruled by the major car rental and sharing companies. Nonetheless, there is still potential and
place for small and medium-size car sharing companies to build significant market share. Those companies are focusing
on consumer niches, including local neighborhood service, all-electric, luxury fleet, point-to-point, student car sharing,
among others. The competition in corporate and government sectors is relatively small. Consequently, we decided to
focus on exploring those segments.
1 www.Trendforce.com
2 tsrc.com
3
1.1 SWOT Analysis
The main strengths, weaknesses, opportunities and threats of COTG are presented below:
Strengths Opportunities
- The offer of the service in the 2 major cities
in Canada
- Fleet size
- 50 locations in each market
- Convenient fee structure
- Raise brand awareness
- Governmental partnerships and corporate membership
programs
- Brand partnerships
- Expand markets beyond GTA
- Creation of a loyalty program
Weaknesses Threats
- Low brand awareness
- B2B opportunities are not been tackled to
the fullest
- Lack of differentiation
- Traditional rental service companies and new players
joining the car sharing market
- Strategic parking lots already taken by competitors
After having a look inside COTG performance, current situation, current trends of the industry and the last movements of
the competitors, the biggest opportunity that was found is the development of a B2B special program to unveil our service
as, at the same time a cheaper transportation solution and an innovative eco-friendly corporate benefit.
4
2. Competitive Overview Analysis
Name of the company Membership process Costs Features & PODs
Members fee $45 per
year, can be done
online. Must be 19
years old with valid
driving license.
Additional to membership fee –
hourly rate of $9.50.
Over 50 locations in the market.
Simple pricing system. Special
offers and exclusive corporate
services as well as special
conditions for government
packages. Available for 19+
Membership cost $29
to register online.
Members must be 21
years old with a valid
"G" level license.
Approval usually takes
two business days.
AutoShare offers three types of
plans. Basic plan: An annual
membership fee will cost $45,
with a $9.25 hourly charge and
$0.25 per kilometer beyond the
include 150. Vehicles must be
booked for a minimum of one
hour, with the option of adding
additional increments of 30
minutes. The daily rate during
the week is $71, and $76 on the
weekend.
AutoShare is operating on the
Canadian market for more than
17 years and have more than
175 self-serve pickup
locations for their fleet of rental
cars and full-size cargo vans in
Toronto. One of the
differentiations is the age of
the customers – from 21 only.
Auto share also offers
additional discounts for
members: in restaurants,
insurance companies, VIA trail,
etc. New positioning of the
brand – Enterprise Car share
Membership cost $35.
After registering
online, members can
expect to receive their
card in the mail in
about five business
days. Must be over 19
with a valid license.
One plan for everyone. The cost
is $0.35 minute, with an hourly
maximum of $12.99. The daily
maximum is $65.99, with a
$0.45/km charge beyond the free
200. No minimum time
requirements.
One of the youngest companies
among the competitors (7 years
on the market), Car2Go
exclusively stocks Smart Cars.
Car2Go has the most limited
number of pickup/drop-off
locations, extending west to
Jane, east to Victoria Park, and
only as far north as Eglinton.
Available from 21 years old.
An online application
fee of $30 with
approved members
receiving their cards in
the mail in one to three
business days. Must be
21 years old and have
held a valid license for
at least one year.
3 plans:
- the occasional driver package
costs $70 annual, with weekday
rates from $9.25 per hour. Daily
weekday and weekend
maximums are $79. An
additional cost of $0.30/km after
200.
World leader in car sharing
with high reputations all over
the world, Zipcar got a diverse
roster of vehicles. Cars must be
returned to the location in
which they were picked up.
Around 40 locations in GTA.
Also provides service only for
people from 21 years old.
Zipcar also offers a huge
amount of additional discounts
within different cities all over
Canada.
C TG
5
3. Business Objectives
- Become the car sharing service of choice when it comes to companies and public institutions
- Raise awareness of the advantages and new opportunities of using COTG for business
- Highlight COTG benefits in order to gain 11500 new members or 115% of our current market share by the end of 2016
- Deliver excellent performance, simple usage and extremely competitive prices combined with special offers
Current Forecast % of change
Awareness 20% 30% 10%
Locations 50 100 50
Market share 30% 45% 15%
4. Target Audience
Target Segment Locations Industry Size
Number of
employees
Behaviour Needs
Segment #1-
Private
Companies Toronto
(GTA)
Montreal
Finance
Accountant
Advertising
Agencies
Contractors
Designers
Brokers
Mortgage
Specialists
Medium
Sized
(50 - 499)
Companies looking
for innovative
corporate benefits
Companies looking
for efficient ways of
transportation
Reduce fleet
costs
Solutions for
short-term
transportation
Segment #2 -
Governmental
Institutions
Primary Target Audience
Companies that have a need of providing their employees with short-term transportation to keep their productivity.
Therefore, these companies might be interested in acquiring our memberships as a corporate benefit for their employees.
COTG also will satisfy the transportation needs more effectively and at a lower price, compared to taxi cabs or acquiring
new vehicles.
Secondary Target Audience
A potential secondary target audience will be the government emphasizing the same benefits offered for companies within
the private sector; the opportunity to satisfy their transportation needs more effectively and at a lower price, compared to
taxi cabs or acquiring new vehicles.
Test
We will include in our test target group different departments within the company such as HR, sales, financial department
in middle size companies. The rationale behind the creation of this test target segment is to measure effectiveness of our
campaign through a strategic sample.
6
5. Audience Objections
Companies may have misconceptions about how car sharing service works, or doubts about car insurance and how
membership works. They could also have some concerns regarding our parking spots in relation to their company’s
location and the areas where their employees need to travel.
Therefore, we will develop corporate presentations to present our services and explain in detail the principle of car sharing
and how it will work between COTG and the company. Moreover, when pitching our new membership packages we will
clarify that they can be customized depending on the company’s requirements and specifications, highlighting how simple
the process is and how much they can save by using our service.
To overcome the parking lots concerns we will train our team to show the benefits of our 50 strategic locations in
Toronto, exclusive for COTG vehicles, which are accessible on public transportation. Additionally, our corporate offer
will also include the possibility to have parking spots available within the company depending on the size of the
membership package.
6. Marketing Strategy
COTG will introduce a plan focusing on B2B to introduce the car sharing membership as an innovative and convenient
corporate benefit and, in the same time, as a smart solution of short-term transportation, replacing fleets, taxi cabs and
traditional rental car services.
Positioning Statement
Cars on the Go. An innovative, smart and green solution for companies, which always want to be miles ahead.
Benefits of COTG
Suit your business needs. Our membership packages are flexible and can be customized to meet different companies’
sizes and needs.
Financial Benefits. In addition to bring to your employees an innovative corporate benefit with low absolute cost but high
perception value, throughout the car sharing membership, organizations can reduce fleet costs and their employees can
have easy and cost-effective access to vehicles when its needed for business and personal purposes.
Environmental Benefits. By offering the car sharing corporate benefit for employees, companies have the opportunity to
help to reduce the number of cars on the road, lower CO2 emissions polluting the air and the incentive to make greener
transportation choices.
Social Benefits. Car sharing is convenient. Once a member, it is possible to reserve and pick up cars at convenience. In
addition to the 50 locations that COTG already have in Toronto, it is offered the opportunity to have a permanent location
within the company.
Features of COTG
- Exclusive intranet with a company profile (depending on the deal)
- Booking vehicles online.
- The opportunity to have a permanent station in your company based on number of memberships acquired and usage of
the service.
- Reports to measure employees' usage of the service
7
Unique Sale Proposition
An exclusive corporate membership combined with unique services for adopting the car sharing service as a corporate
benefit as well as a new solution for short-term transportation in your company.
7. Communications Objectives
Primary target audience - save money and time while giving more benefits for your employees. Companies will have an
exclusive opportunity to make the life of their employees easier by giving them a car sharing membership as a benefit.
The secondary message will be – help the environment by using eco-friendly car sharing service.
Secondary target group – with COTG you can help the environment by reducing emissions from the use of private cars, as
well as contribute with the reduction of traffic congestions and cut down the demand for parking.
The secondary message will be: We will make transportation cheaper for Torontonians through the incentive of the
adoption of the car sharing memberships as a new corporate benefit through diverse companies in Toronto. In addition,
we want to boost brand awareness of COTG within companies, government institutions and residents of Toronto and
GTA.
In addition to our primary and secondary audience, we will have a test target in Toronto. The sales team members will
arrange personal meetings with them in December 2015 to gather insights and additional information. The message will
be the same as for primary target audience.
8. The Offer
Car on the Go is pleased to unveil the new way of sharing cars within company’s, businesses and governments. This
creative replacement of the conventional perception of driving a car will lead us to the all-new convenient way of
commuting, driving, solving business issues and always enjoying your trip. While doing business or personal activities
you won’t think anymore about gas, insurance and debt, which you need to pay for your car.
We are proud to introduce our incentive program for companies and governmental institutions that will be using our
service and happy to offer membership packages for reasonable prices and the ability to customize the offer based on our
clients wishes
Moreover, we will be launching the following special offers to enhance the effectiveness of our campaign:
1) Free 14 days for Trial: 10 cars assigned per each company. From April 2016 – till May 2016. This will give us an
opportunity to increase awareness and show the PODs of COTG related to our competitors.
The rationale behind car expenditures will be calculated through the average car depreciation per day, based on average
mileage, general condition and the age of the car.
On average, car depreciation consists from 10-12% from the total cost of the car per year. Most of our fleet consists of
new cars with the market value varying between $25.000- $30.000. With a math behind, it will be approximately $2.750
per year and $8 per day breaking it down for each car. Roughly, our free trial offer to the company with all cars involved
will cost us - $1,120.
2) Starting from September 2016 we will introduce the second offer – discount of 10% while acquiring 100
memberships.
8
The cost of this specific offer will comprise the amount of money that we are planning to receive from selling 100
memberships – 10% discount. That will be $450 per company.
3) Annual incentive to increase the usage of the service. The company with higher usage of service will get an exclusive
car for the second year of renovation and we will cover all the expenses (gas and insurance).
9. Tactics and Implementation
We decided to test our Direct marketing campaign in Toronto for 4 months with a budget of 50 000 till April. Starting
from May we will launch massive campaign in Montreal and Toronto.
Personal Selling
One of the key promotion strategy for selling our product will be personal selling.
We will have personal meetings using different contacts within the companies, such as HR professionals, financial
department representative, Sales teams, Directors of departments etc.
This will be the most effective way to sell our product.
Email marketing
The end objective is to increase the corporate customers’ base by 115%. Personalized emails will communicate the main
benefits for our potential customers. We will have 4 stages of the email marketing campaign.
Stage 1:
Timing
In January-February we will send emails focusing on main benefits of COTG. During this stage we will focus our efforts
on raising awareness of the exclusive service that the company offers comparing to our competitors as well as the free
trial opportunity.
Target
This email campaign will cover our 2 target groups.
We will use rented email list of 500 000 contacts that will mainly contain:
- HR professionals, Directors, Sale Executives and Companies’ owners with more than 20 people in the company
- Government institutions
Content
The emails will present our USP’s as well as a link to the landing page with a promotional video that will unveil all the
benefits that companies can get from COTG and the exclusive offer to get a free trial. In addition, on our landing page
will be link to sign up for the news and free trial.
Response rate
We expect to achieve a response rate of 0.01%.
Cost
1.24 cents per email, that is $6200 in total and $500 to rent mailing list + the cost of developing the video and its landing
page - $15000. We will hire an overseas digital agency (W3Americas), which will reduce our development cost by 30%
Total cost for 1st stage: 6200+500+15000=21700.
Mock-ups for first wave of emails and first landing page can be found in Appendix C (13.1 & 13.2).
9
Stage 2:
Timing
A second wave of email marketing will take place in March.
Target
We are expecting to send around 20 000 emails. We will gather the email list in January-February that will include
potential clientele who are interested in acquiring our corporate memberships. The list will include:
1) Companies who signed up for the free trial. We are expecting to engage around 100 companies.
2) Moreover, we will place our booths at HR conferences in January and February where we will pitch our service
through the free trial offer and promotion of the diverse packages that suit different needs of the companies. In addition,
we will offer registration to receive news emails with special promotions from our company. The cost of placing the booth
is around $500 per 1 day = $500*4 = $2000.
3) Companies who registered through our first promotional landing page.
4) Current database of corporate members
Content
This stage will comprise our second offer (10% OFF) that will be articulated through a promotional code that can be used
on the second landing page. At the same time, the landing page will contain a registration form and a box to include the
promotional code. This feature will allow our users to see the total discount that the company will receive based on the
number of memberships.
Mock-ups can be found in Appendix C (13.3 & 13.4).
Response rate
We are planning to get 6% response and get 1200 new members.
Cost
Cost of developing the second landing page will be $ 10 000 and we will use the same digital agency.
Considering the number of emails – around 20 000, the cost will be 1.24* 20 000 = $248.
Plus $2000 per HR conferences
Stage 3
The same email marketing campaign as in Stage 1 will be send in July with audience 1 000 000.
Cost
1.24 cents per email, that is $12400 and $1000 to rent mailing list. Total cost = $13400
We will use the mock up for Stage 1.
Stage 4
The same email campaign as in Stage 2 will be send in September with audience 50 000 (House list of client) In addition,
we will include in the list contacts gathered from sponsored initiatives (HR conferences) till September = 10 conferences
Cost
Average $500 each, that is $5000 in total
We will use the mock up for Stage 1.
10
Event for VIP potential companies - End of March.
Timing
End of the march
Target
The event will target HR executives from midsize companies. The first 200 people who will register for the event will get
tickets. The invitation to register will be send through a special press kit and will require RSVP and a limit of 2
representatives per company.
Content
We came up with the idea of conducting an event on the occasion of the launching of the new services developed by the
COTG team in order to meet specific needs of the private and public sectors. The event will take place on Metro Toronto
Convention Center – a modern high-end venue. The event will present the topic “Top Trends Influencing Employee
Benefits in 2016” and we will have 3 influencers as speakers. Doctor Ron Friedman Ph.D., a social psychologist who
specializes in human motivation will be one of them. Our CEO will be introducing the innovative services as well as the
exclusive offers from COTG to public and private sectors during the event. An exclusive brunch service will be also
provided to the guests. The invitation for this event will be send by direct mail (mock up included in Appendix C (13.5)).
and details and cost will be presented below.
One of the most crucial parts of event marketing is follow-ups with visitors. Thus, we have decided to use direct mail as
the form of follow up with a special “Thank you letter”, as well as, to provide details about our special offers for
companies and government. The details of this wave of direct mail will be included below. Lastly, the result of event will
be measured by the following metrics: number of attendees, number of new corporate clients (companies), number of new
members and total amount of sales.
Cost
A list of potential fixed expenses
Venue rental $15 000
Speakers salary $ 16000
Equipment hire (projectors, sound systems, flip charts, white boards,
poster boards, tables, chairs etc)
Included in price of the venue rental
Salary for staff $5000
Management or organization fees Will be organized by marketing team
A list of potential per person costs will include:
Registration packs $20*200 = $4000
Catering (reception and morning and afternoon coffee breaks) $20*200 = $4000
Internet access and printing cost $5*200 = $1000
Total $45 000
Table 1: Cost for event
The metrics for measuring the result of first and second email campaign can be found in Table 2.
11
Direct Mail
First wave:
Timing
The first wave of our direct mail campaign will be sent in the end of February.
Target
The database with target the audience selected by our marketing team. We will target current and potential customer
within government institutions and big companies – our secondary target – around 5000 contacts in 2000 companies
across Toronto and GTA.
Content
The next tactic that we will be using during our campaign is Direct Mail with a special offer of free trial, as well an
invitation to our Event for VIP potential companies – at the end of March.
Response rate
200 people that will assist to our event.
Cost
Design of the Mock-up for direct mail will be created by our marketing team, thus the cost of one mail will consist
shipping cost and printing cost and will be around $1,5 per each mail.
Total cost: 1,5*5000= $7500.
The mock-up can be found in Appendix C (13.4).
Second wave:
Timing
Second wave of the Direct Mail campaign will be in the beginning of April.
Target
The 200 people who visit the event by the end of March.
Content
“Thank you letter” and details about special offers for government and companies. The incentive will be the opportunity
to have one of the COTG cars for free for the whole year (including gas and insurance expenses).
The mock-up can be found in the Appendix C (13.6).
Response rate
We expect to achieve around 50%-60% of response rate.
Cost
Design of the Mock-up for direct mail will be created by marketing team, thus the cost of one mail will consist shipping
cost and printing cost and will be around $1,5 per each mail.
Total cost: 1,5*200= $300.
The metrics for measuring the result of first and second direct mail campaign can be found in Table 10.
LinkedIn promotion
After secondary research, we have decided to use in our IMC the most effective social media to reach professionals –
LinkedIn.
Timing
We will run our LinkedIn campaign for the whole year
12
Target
We will use sponsored direct marketing and pay for 1000 CPM (pay-per 1000 impressions) with a budget of $2000 per
day. We will run the campaign on Wednesdays. Based on secondary research – it is one of the most effective days to
reach our target.
Content
Promoting COTG and special offers.
The mock-up included in Appendix C (13.7)
Response rate
We are expecting to get more than 170 clicks per ad (approximately $3 per click) and 0.25% of conversion rate.
Cost
48*2000 = $96000
10. Budget
The breakdown budget for our Direct Marketing campaign is presented in the Table below. Our Promotion
Campaign will be 10% of the Forecasting Sales.
#
Strategy /
Tactic
# Contacts
Response Conversion
Total Sales
Costs
Total
Cost
CPM
Return on
Investment#
respond
ed
Respon
se Rate
#
convert
ed
Conver
sion
Rate
Convert
ed/Resp
onded
Rate
Fixed
Variable
(per 1)
1
First stage
Email
Marketing
500000 5000 1% 200 4% 4% 100000 7725 6200 13925 $28 $7 :$1
2
Second stage
Email
Marketing
20000 12000 60% 1200 10% 10% 600000 5000 248 5248 $262 $114 :$1
3
Third Stage
Email
Marketing
1000000 10000 1% 400 4% 4% 200000 7725 12400 20125 $20 $10 :$1
4
Forth Stage
Email
Marketing
50000 30000 60% 3000 10% 10% 1500000 5000 620 5620 $112 $267 :$1
5
HR
conferences
booth
10,000 1,000 10% 700 7% 70% 350000 $7,000 $0 7000 $700 $50 :$1
6 VIP Event 5,000 200 4% 100 2% 50% 50000 $36,000 $9,000
$45,00
0
$9,000 $1 :$1
7 Direct Mail 5,000 750 15% 185 3.7%
24.67
%
92500 $7,500 $7,500 $1,500 $12 :$1
8
Direct Mail
Second Wave
200 120 60% 60 50% 50% 30000 $300 $300 $1,500 $100 :$1
9
LinkedIn
promotion
100,000 2,720 3% 816 30% 30% 408000 $8,000
$96,00
0
$960 $4 :$1
10
Personal
Selling
50,000 20,000 80% 16000 70% 80% 8000000
$1,000,0
00
$1,000,
000
$20,00
0
$8 :$1
Total 1,740,200 4,790 22,661 $11,330,500 $76,450 $16,800
$1,200,
718
$1,565
Table X: Budget breakdown for 2016
In the table:
 under "Response Rate" we count customer who responded by clicking on the link in email, responded by
phone or email, got a free trial, shared promo or went to the event;
 under "Conversion Rate" we count number of memberships acquired to total # of customers to whom we
promoted to;
 Under "Converted/Responded Rate" (in-class version of Conversion Rate) we count number of memberships # of
customers who responded to promotion.
Also we are planning to spend 40 000 for Research and Training.
13
11. Appendix A: Blocking Chart
12. Appendix B - Creative Brief - COTG
11.1 What is the problem we are trying to solve?
We want to achieve the members’ acquisition goal through an annual direct marketing campaign focusing on the
development of B2B. It is important to keep in mind that it will be the first time that COTG will develop and
communicate special offers for corporate clients and we know the importance of make a good first impression.
12.2 What results do we need to deliver?
- Become the car sharing service of choice when it comes to companies and public institutions
- Raise awareness of the advantages and new opportunities of using COTG for business
- Highlight COTG benefits in order to gain 11500 new members or 115% of our current market share by the end of 2016
- Deliver excellent performance, simple usage and extremely competitive prices combined with special offers
12.3 Who are the audience?
Midsize companies (from 50 to 499 employees) with offices in Toronto and GTA.
City of Toronto
The campaign will be targeting: HR professionals, Finance professionals, Sales Directors and Business Owners from
companies within the aforementioned segment.
12.4 What do we want the audience to believe?
We want the audience to believe that COTG is a smart and green solution for companies, which always want to be miles
ahead. In addition, we want to position our company as the most innovative and convenient option of car sharing for
corporate clients.
12.5 Why should they believe it?
The reasons to believe are categorical through the following features and benefits offered by COTG for companies:
Suit your business needs. Our membership packages are flexible and can be customized to meet different companies’
sizes and needs.
Pre launch JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Online When
Promo Landing Pages
E-mail MKT
LinkedIn Ads
Offline
Personal Selling
Direct Mail
PR & Events
HR Conferences
Sponsorship
VIP Event
14
Financial Benefits. In addition to bring to your employees an innovative corporate benefit with low absolute cost but high
perception value, throughout the car sharing membership, organizations can reduce fleet costs and their employees can
have easy and cost-effective access to vehicles when its needed for business and personal purposes.
Environmental Benefits. By offering the car sharing corporate benefit for employees, companies have the opportunity to
help to reduce the number of cars on the road, lower CO2 emissions polluting the air and the incentive to make greener
transportation choices.
Social Benefits. Car sharing is convenient. Once a member, it is possible to reserve and pick up cars at convenience. In
addition to the 50 locations that COTG already have in Toronto, it is offered the opportunity to have a permanent location
within the company.
12.6 What is special or different about the client in this area?
COTG will be offering a free trial and 10% off for corporate packages of memberships. Moreover, we will also
distinguish our service through the following features:
- New member registration and exclusive intranet with a company profile (depending on the deal)
- The opportunity to have a permanent station in the company based on number of memberships acquired and usage of the
service.
- Stats about the usage of the service for your employees.
12.7 What do we want the audience to do?
1. We want them to be engaged with our direct marketing campaign.
2. We want to increase the acquisition of corporate packages of memberships through the our special offers (free trial and
10% for corporate clients).
3. Build awareness about our exclusive services and offers for companies and, in the same time, increase our lead
generation through our promotional and DM activities.
12.8 What is the budget and timeframe?
1 year of direct marketing campaign with total budget of $ 1,250,000.
12.9 What else is it essential that we know?
We want to drive all the communications to our digital channels (promotional landing pages). The special offers also
should be included in all of the pieces.
Website and 0800 must be included (we will have part of the team trained to provide high levels of customer service for
corporate clients.
12.10 Measures of success
The effectiveness of the campaign will be measure through sales volume, ROI, response rates, conversion rates, leads
generation.
15
13. Appendix C Creative Mock ups
13.1 Email Campaign (Stage 1)
16
13.2 Landing Page (Stage 2)
17
13.3 Email Campaign (Stage 3)
18
13.4 Landing Page (Stage 4)
19
13.5 Direct Mail (Stage 1)
20
13.6 Direct Mail (Stage 2)
21
13.6 LinkedIn Campaign.
22
References
http://nanaimocarshare.ca/layout/docs/20130708InnovativeMobilityCarsharingOutlook.pdf
http://www.marketwatch.com/story/car sharing-will-replace-234-to-338-million-private-cars-by-2016-2015-08-26
https://newsroom.bmo.com/press-releases/five-year-sw-itch-bmo-poll-reveals-canadian-car--tsx-bmo-
201407080956041001

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COTG Final Example

  • 1. 1 C TGDirect Marketing Plan MARK 1107 Fall 2015 Professor: Boucher, Laurence Class: Wednesday, 8 a.m Killner, Cynthia Makei, Dmytro Sytnyk, Iryna Torres, Edgardo Version #2 November 24th 2015
  • 2. 2 1. Background situation analysis Car sharing is increasing in popularity in most cities of Canada such as Toronto and Montreal. The market is attracting competitors from traditional car rental services and new entrants. COTG has been expanding its market share in these two major cities in about 30%. Key market facts forecast for 2016:1  Car sharing industry will replace 3.38 million private car  Car sharing industry expects more than 15 million members  Fleet will involve 260,000 vehicles Taking all into account car sharing has substantial cost-effective advantage over other transportation methods comprising carpooling, says one of the automotive analysts from TrendForce. Research shows there were 46 car sharing operators in the U.S., Canada, and Mexico serving approximately a million active members, with a combined fleet of almost 16.000 vehicles. Interpolating these stats, we can estimate that in Canada there are 3 service providers with more than 1,120 vehicles. After the acquisition of Zipcar by AvisBudget Group, it became one of the biggest car-sharing providers in the world. Currently, AvisBudget represents 79% of the rental car market and 63% of car sharing market in North America.2 In Canada, AvisBudget Group represents 9% and 11% respectively. In Canada, car sharing is mainly used by millennials. The top reasons to share are work related purposes as well as business meetings and personal use. Competition and opportunities: The majority of the market is ruled by the major car rental and sharing companies. Nonetheless, there is still potential and place for small and medium-size car sharing companies to build significant market share. Those companies are focusing on consumer niches, including local neighborhood service, all-electric, luxury fleet, point-to-point, student car sharing, among others. The competition in corporate and government sectors is relatively small. Consequently, we decided to focus on exploring those segments. 1 www.Trendforce.com 2 tsrc.com
  • 3. 3 1.1 SWOT Analysis The main strengths, weaknesses, opportunities and threats of COTG are presented below: Strengths Opportunities - The offer of the service in the 2 major cities in Canada - Fleet size - 50 locations in each market - Convenient fee structure - Raise brand awareness - Governmental partnerships and corporate membership programs - Brand partnerships - Expand markets beyond GTA - Creation of a loyalty program Weaknesses Threats - Low brand awareness - B2B opportunities are not been tackled to the fullest - Lack of differentiation - Traditional rental service companies and new players joining the car sharing market - Strategic parking lots already taken by competitors After having a look inside COTG performance, current situation, current trends of the industry and the last movements of the competitors, the biggest opportunity that was found is the development of a B2B special program to unveil our service as, at the same time a cheaper transportation solution and an innovative eco-friendly corporate benefit.
  • 4. 4 2. Competitive Overview Analysis Name of the company Membership process Costs Features & PODs Members fee $45 per year, can be done online. Must be 19 years old with valid driving license. Additional to membership fee – hourly rate of $9.50. Over 50 locations in the market. Simple pricing system. Special offers and exclusive corporate services as well as special conditions for government packages. Available for 19+ Membership cost $29 to register online. Members must be 21 years old with a valid "G" level license. Approval usually takes two business days. AutoShare offers three types of plans. Basic plan: An annual membership fee will cost $45, with a $9.25 hourly charge and $0.25 per kilometer beyond the include 150. Vehicles must be booked for a minimum of one hour, with the option of adding additional increments of 30 minutes. The daily rate during the week is $71, and $76 on the weekend. AutoShare is operating on the Canadian market for more than 17 years and have more than 175 self-serve pickup locations for their fleet of rental cars and full-size cargo vans in Toronto. One of the differentiations is the age of the customers – from 21 only. Auto share also offers additional discounts for members: in restaurants, insurance companies, VIA trail, etc. New positioning of the brand – Enterprise Car share Membership cost $35. After registering online, members can expect to receive their card in the mail in about five business days. Must be over 19 with a valid license. One plan for everyone. The cost is $0.35 minute, with an hourly maximum of $12.99. The daily maximum is $65.99, with a $0.45/km charge beyond the free 200. No minimum time requirements. One of the youngest companies among the competitors (7 years on the market), Car2Go exclusively stocks Smart Cars. Car2Go has the most limited number of pickup/drop-off locations, extending west to Jane, east to Victoria Park, and only as far north as Eglinton. Available from 21 years old. An online application fee of $30 with approved members receiving their cards in the mail in one to three business days. Must be 21 years old and have held a valid license for at least one year. 3 plans: - the occasional driver package costs $70 annual, with weekday rates from $9.25 per hour. Daily weekday and weekend maximums are $79. An additional cost of $0.30/km after 200. World leader in car sharing with high reputations all over the world, Zipcar got a diverse roster of vehicles. Cars must be returned to the location in which they were picked up. Around 40 locations in GTA. Also provides service only for people from 21 years old. Zipcar also offers a huge amount of additional discounts within different cities all over Canada. C TG
  • 5. 5 3. Business Objectives - Become the car sharing service of choice when it comes to companies and public institutions - Raise awareness of the advantages and new opportunities of using COTG for business - Highlight COTG benefits in order to gain 11500 new members or 115% of our current market share by the end of 2016 - Deliver excellent performance, simple usage and extremely competitive prices combined with special offers Current Forecast % of change Awareness 20% 30% 10% Locations 50 100 50 Market share 30% 45% 15% 4. Target Audience Target Segment Locations Industry Size Number of employees Behaviour Needs Segment #1- Private Companies Toronto (GTA) Montreal Finance Accountant Advertising Agencies Contractors Designers Brokers Mortgage Specialists Medium Sized (50 - 499) Companies looking for innovative corporate benefits Companies looking for efficient ways of transportation Reduce fleet costs Solutions for short-term transportation Segment #2 - Governmental Institutions Primary Target Audience Companies that have a need of providing their employees with short-term transportation to keep their productivity. Therefore, these companies might be interested in acquiring our memberships as a corporate benefit for their employees. COTG also will satisfy the transportation needs more effectively and at a lower price, compared to taxi cabs or acquiring new vehicles. Secondary Target Audience A potential secondary target audience will be the government emphasizing the same benefits offered for companies within the private sector; the opportunity to satisfy their transportation needs more effectively and at a lower price, compared to taxi cabs or acquiring new vehicles. Test We will include in our test target group different departments within the company such as HR, sales, financial department in middle size companies. The rationale behind the creation of this test target segment is to measure effectiveness of our campaign through a strategic sample.
  • 6. 6 5. Audience Objections Companies may have misconceptions about how car sharing service works, or doubts about car insurance and how membership works. They could also have some concerns regarding our parking spots in relation to their company’s location and the areas where their employees need to travel. Therefore, we will develop corporate presentations to present our services and explain in detail the principle of car sharing and how it will work between COTG and the company. Moreover, when pitching our new membership packages we will clarify that they can be customized depending on the company’s requirements and specifications, highlighting how simple the process is and how much they can save by using our service. To overcome the parking lots concerns we will train our team to show the benefits of our 50 strategic locations in Toronto, exclusive for COTG vehicles, which are accessible on public transportation. Additionally, our corporate offer will also include the possibility to have parking spots available within the company depending on the size of the membership package. 6. Marketing Strategy COTG will introduce a plan focusing on B2B to introduce the car sharing membership as an innovative and convenient corporate benefit and, in the same time, as a smart solution of short-term transportation, replacing fleets, taxi cabs and traditional rental car services. Positioning Statement Cars on the Go. An innovative, smart and green solution for companies, which always want to be miles ahead. Benefits of COTG Suit your business needs. Our membership packages are flexible and can be customized to meet different companies’ sizes and needs. Financial Benefits. In addition to bring to your employees an innovative corporate benefit with low absolute cost but high perception value, throughout the car sharing membership, organizations can reduce fleet costs and their employees can have easy and cost-effective access to vehicles when its needed for business and personal purposes. Environmental Benefits. By offering the car sharing corporate benefit for employees, companies have the opportunity to help to reduce the number of cars on the road, lower CO2 emissions polluting the air and the incentive to make greener transportation choices. Social Benefits. Car sharing is convenient. Once a member, it is possible to reserve and pick up cars at convenience. In addition to the 50 locations that COTG already have in Toronto, it is offered the opportunity to have a permanent location within the company. Features of COTG - Exclusive intranet with a company profile (depending on the deal) - Booking vehicles online. - The opportunity to have a permanent station in your company based on number of memberships acquired and usage of the service. - Reports to measure employees' usage of the service
  • 7. 7 Unique Sale Proposition An exclusive corporate membership combined with unique services for adopting the car sharing service as a corporate benefit as well as a new solution for short-term transportation in your company. 7. Communications Objectives Primary target audience - save money and time while giving more benefits for your employees. Companies will have an exclusive opportunity to make the life of their employees easier by giving them a car sharing membership as a benefit. The secondary message will be – help the environment by using eco-friendly car sharing service. Secondary target group – with COTG you can help the environment by reducing emissions from the use of private cars, as well as contribute with the reduction of traffic congestions and cut down the demand for parking. The secondary message will be: We will make transportation cheaper for Torontonians through the incentive of the adoption of the car sharing memberships as a new corporate benefit through diverse companies in Toronto. In addition, we want to boost brand awareness of COTG within companies, government institutions and residents of Toronto and GTA. In addition to our primary and secondary audience, we will have a test target in Toronto. The sales team members will arrange personal meetings with them in December 2015 to gather insights and additional information. The message will be the same as for primary target audience. 8. The Offer Car on the Go is pleased to unveil the new way of sharing cars within company’s, businesses and governments. This creative replacement of the conventional perception of driving a car will lead us to the all-new convenient way of commuting, driving, solving business issues and always enjoying your trip. While doing business or personal activities you won’t think anymore about gas, insurance and debt, which you need to pay for your car. We are proud to introduce our incentive program for companies and governmental institutions that will be using our service and happy to offer membership packages for reasonable prices and the ability to customize the offer based on our clients wishes Moreover, we will be launching the following special offers to enhance the effectiveness of our campaign: 1) Free 14 days for Trial: 10 cars assigned per each company. From April 2016 – till May 2016. This will give us an opportunity to increase awareness and show the PODs of COTG related to our competitors. The rationale behind car expenditures will be calculated through the average car depreciation per day, based on average mileage, general condition and the age of the car. On average, car depreciation consists from 10-12% from the total cost of the car per year. Most of our fleet consists of new cars with the market value varying between $25.000- $30.000. With a math behind, it will be approximately $2.750 per year and $8 per day breaking it down for each car. Roughly, our free trial offer to the company with all cars involved will cost us - $1,120. 2) Starting from September 2016 we will introduce the second offer – discount of 10% while acquiring 100 memberships.
  • 8. 8 The cost of this specific offer will comprise the amount of money that we are planning to receive from selling 100 memberships – 10% discount. That will be $450 per company. 3) Annual incentive to increase the usage of the service. The company with higher usage of service will get an exclusive car for the second year of renovation and we will cover all the expenses (gas and insurance). 9. Tactics and Implementation We decided to test our Direct marketing campaign in Toronto for 4 months with a budget of 50 000 till April. Starting from May we will launch massive campaign in Montreal and Toronto. Personal Selling One of the key promotion strategy for selling our product will be personal selling. We will have personal meetings using different contacts within the companies, such as HR professionals, financial department representative, Sales teams, Directors of departments etc. This will be the most effective way to sell our product. Email marketing The end objective is to increase the corporate customers’ base by 115%. Personalized emails will communicate the main benefits for our potential customers. We will have 4 stages of the email marketing campaign. Stage 1: Timing In January-February we will send emails focusing on main benefits of COTG. During this stage we will focus our efforts on raising awareness of the exclusive service that the company offers comparing to our competitors as well as the free trial opportunity. Target This email campaign will cover our 2 target groups. We will use rented email list of 500 000 contacts that will mainly contain: - HR professionals, Directors, Sale Executives and Companies’ owners with more than 20 people in the company - Government institutions Content The emails will present our USP’s as well as a link to the landing page with a promotional video that will unveil all the benefits that companies can get from COTG and the exclusive offer to get a free trial. In addition, on our landing page will be link to sign up for the news and free trial. Response rate We expect to achieve a response rate of 0.01%. Cost 1.24 cents per email, that is $6200 in total and $500 to rent mailing list + the cost of developing the video and its landing page - $15000. We will hire an overseas digital agency (W3Americas), which will reduce our development cost by 30% Total cost for 1st stage: 6200+500+15000=21700. Mock-ups for first wave of emails and first landing page can be found in Appendix C (13.1 & 13.2).
  • 9. 9 Stage 2: Timing A second wave of email marketing will take place in March. Target We are expecting to send around 20 000 emails. We will gather the email list in January-February that will include potential clientele who are interested in acquiring our corporate memberships. The list will include: 1) Companies who signed up for the free trial. We are expecting to engage around 100 companies. 2) Moreover, we will place our booths at HR conferences in January and February where we will pitch our service through the free trial offer and promotion of the diverse packages that suit different needs of the companies. In addition, we will offer registration to receive news emails with special promotions from our company. The cost of placing the booth is around $500 per 1 day = $500*4 = $2000. 3) Companies who registered through our first promotional landing page. 4) Current database of corporate members Content This stage will comprise our second offer (10% OFF) that will be articulated through a promotional code that can be used on the second landing page. At the same time, the landing page will contain a registration form and a box to include the promotional code. This feature will allow our users to see the total discount that the company will receive based on the number of memberships. Mock-ups can be found in Appendix C (13.3 & 13.4). Response rate We are planning to get 6% response and get 1200 new members. Cost Cost of developing the second landing page will be $ 10 000 and we will use the same digital agency. Considering the number of emails – around 20 000, the cost will be 1.24* 20 000 = $248. Plus $2000 per HR conferences Stage 3 The same email marketing campaign as in Stage 1 will be send in July with audience 1 000 000. Cost 1.24 cents per email, that is $12400 and $1000 to rent mailing list. Total cost = $13400 We will use the mock up for Stage 1. Stage 4 The same email campaign as in Stage 2 will be send in September with audience 50 000 (House list of client) In addition, we will include in the list contacts gathered from sponsored initiatives (HR conferences) till September = 10 conferences Cost Average $500 each, that is $5000 in total We will use the mock up for Stage 1.
  • 10. 10 Event for VIP potential companies - End of March. Timing End of the march Target The event will target HR executives from midsize companies. The first 200 people who will register for the event will get tickets. The invitation to register will be send through a special press kit and will require RSVP and a limit of 2 representatives per company. Content We came up with the idea of conducting an event on the occasion of the launching of the new services developed by the COTG team in order to meet specific needs of the private and public sectors. The event will take place on Metro Toronto Convention Center – a modern high-end venue. The event will present the topic “Top Trends Influencing Employee Benefits in 2016” and we will have 3 influencers as speakers. Doctor Ron Friedman Ph.D., a social psychologist who specializes in human motivation will be one of them. Our CEO will be introducing the innovative services as well as the exclusive offers from COTG to public and private sectors during the event. An exclusive brunch service will be also provided to the guests. The invitation for this event will be send by direct mail (mock up included in Appendix C (13.5)). and details and cost will be presented below. One of the most crucial parts of event marketing is follow-ups with visitors. Thus, we have decided to use direct mail as the form of follow up with a special “Thank you letter”, as well as, to provide details about our special offers for companies and government. The details of this wave of direct mail will be included below. Lastly, the result of event will be measured by the following metrics: number of attendees, number of new corporate clients (companies), number of new members and total amount of sales. Cost A list of potential fixed expenses Venue rental $15 000 Speakers salary $ 16000 Equipment hire (projectors, sound systems, flip charts, white boards, poster boards, tables, chairs etc) Included in price of the venue rental Salary for staff $5000 Management or organization fees Will be organized by marketing team A list of potential per person costs will include: Registration packs $20*200 = $4000 Catering (reception and morning and afternoon coffee breaks) $20*200 = $4000 Internet access and printing cost $5*200 = $1000 Total $45 000 Table 1: Cost for event The metrics for measuring the result of first and second email campaign can be found in Table 2.
  • 11. 11 Direct Mail First wave: Timing The first wave of our direct mail campaign will be sent in the end of February. Target The database with target the audience selected by our marketing team. We will target current and potential customer within government institutions and big companies – our secondary target – around 5000 contacts in 2000 companies across Toronto and GTA. Content The next tactic that we will be using during our campaign is Direct Mail with a special offer of free trial, as well an invitation to our Event for VIP potential companies – at the end of March. Response rate 200 people that will assist to our event. Cost Design of the Mock-up for direct mail will be created by our marketing team, thus the cost of one mail will consist shipping cost and printing cost and will be around $1,5 per each mail. Total cost: 1,5*5000= $7500. The mock-up can be found in Appendix C (13.4). Second wave: Timing Second wave of the Direct Mail campaign will be in the beginning of April. Target The 200 people who visit the event by the end of March. Content “Thank you letter” and details about special offers for government and companies. The incentive will be the opportunity to have one of the COTG cars for free for the whole year (including gas and insurance expenses). The mock-up can be found in the Appendix C (13.6). Response rate We expect to achieve around 50%-60% of response rate. Cost Design of the Mock-up for direct mail will be created by marketing team, thus the cost of one mail will consist shipping cost and printing cost and will be around $1,5 per each mail. Total cost: 1,5*200= $300. The metrics for measuring the result of first and second direct mail campaign can be found in Table 10. LinkedIn promotion After secondary research, we have decided to use in our IMC the most effective social media to reach professionals – LinkedIn. Timing We will run our LinkedIn campaign for the whole year
  • 12. 12 Target We will use sponsored direct marketing and pay for 1000 CPM (pay-per 1000 impressions) with a budget of $2000 per day. We will run the campaign on Wednesdays. Based on secondary research – it is one of the most effective days to reach our target. Content Promoting COTG and special offers. The mock-up included in Appendix C (13.7) Response rate We are expecting to get more than 170 clicks per ad (approximately $3 per click) and 0.25% of conversion rate. Cost 48*2000 = $96000 10. Budget The breakdown budget for our Direct Marketing campaign is presented in the Table below. Our Promotion Campaign will be 10% of the Forecasting Sales. # Strategy / Tactic # Contacts Response Conversion Total Sales Costs Total Cost CPM Return on Investment# respond ed Respon se Rate # convert ed Conver sion Rate Convert ed/Resp onded Rate Fixed Variable (per 1) 1 First stage Email Marketing 500000 5000 1% 200 4% 4% 100000 7725 6200 13925 $28 $7 :$1 2 Second stage Email Marketing 20000 12000 60% 1200 10% 10% 600000 5000 248 5248 $262 $114 :$1 3 Third Stage Email Marketing 1000000 10000 1% 400 4% 4% 200000 7725 12400 20125 $20 $10 :$1 4 Forth Stage Email Marketing 50000 30000 60% 3000 10% 10% 1500000 5000 620 5620 $112 $267 :$1 5 HR conferences booth 10,000 1,000 10% 700 7% 70% 350000 $7,000 $0 7000 $700 $50 :$1 6 VIP Event 5,000 200 4% 100 2% 50% 50000 $36,000 $9,000 $45,00 0 $9,000 $1 :$1 7 Direct Mail 5,000 750 15% 185 3.7% 24.67 % 92500 $7,500 $7,500 $1,500 $12 :$1 8 Direct Mail Second Wave 200 120 60% 60 50% 50% 30000 $300 $300 $1,500 $100 :$1 9 LinkedIn promotion 100,000 2,720 3% 816 30% 30% 408000 $8,000 $96,00 0 $960 $4 :$1 10 Personal Selling 50,000 20,000 80% 16000 70% 80% 8000000 $1,000,0 00 $1,000, 000 $20,00 0 $8 :$1 Total 1,740,200 4,790 22,661 $11,330,500 $76,450 $16,800 $1,200, 718 $1,565 Table X: Budget breakdown for 2016 In the table:  under "Response Rate" we count customer who responded by clicking on the link in email, responded by phone or email, got a free trial, shared promo or went to the event;  under "Conversion Rate" we count number of memberships acquired to total # of customers to whom we promoted to;  Under "Converted/Responded Rate" (in-class version of Conversion Rate) we count number of memberships # of customers who responded to promotion. Also we are planning to spend 40 000 for Research and Training.
  • 13. 13 11. Appendix A: Blocking Chart 12. Appendix B - Creative Brief - COTG 11.1 What is the problem we are trying to solve? We want to achieve the members’ acquisition goal through an annual direct marketing campaign focusing on the development of B2B. It is important to keep in mind that it will be the first time that COTG will develop and communicate special offers for corporate clients and we know the importance of make a good first impression. 12.2 What results do we need to deliver? - Become the car sharing service of choice when it comes to companies and public institutions - Raise awareness of the advantages and new opportunities of using COTG for business - Highlight COTG benefits in order to gain 11500 new members or 115% of our current market share by the end of 2016 - Deliver excellent performance, simple usage and extremely competitive prices combined with special offers 12.3 Who are the audience? Midsize companies (from 50 to 499 employees) with offices in Toronto and GTA. City of Toronto The campaign will be targeting: HR professionals, Finance professionals, Sales Directors and Business Owners from companies within the aforementioned segment. 12.4 What do we want the audience to believe? We want the audience to believe that COTG is a smart and green solution for companies, which always want to be miles ahead. In addition, we want to position our company as the most innovative and convenient option of car sharing for corporate clients. 12.5 Why should they believe it? The reasons to believe are categorical through the following features and benefits offered by COTG for companies: Suit your business needs. Our membership packages are flexible and can be customized to meet different companies’ sizes and needs. Pre launch JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Online When Promo Landing Pages E-mail MKT LinkedIn Ads Offline Personal Selling Direct Mail PR & Events HR Conferences Sponsorship VIP Event
  • 14. 14 Financial Benefits. In addition to bring to your employees an innovative corporate benefit with low absolute cost but high perception value, throughout the car sharing membership, organizations can reduce fleet costs and their employees can have easy and cost-effective access to vehicles when its needed for business and personal purposes. Environmental Benefits. By offering the car sharing corporate benefit for employees, companies have the opportunity to help to reduce the number of cars on the road, lower CO2 emissions polluting the air and the incentive to make greener transportation choices. Social Benefits. Car sharing is convenient. Once a member, it is possible to reserve and pick up cars at convenience. In addition to the 50 locations that COTG already have in Toronto, it is offered the opportunity to have a permanent location within the company. 12.6 What is special or different about the client in this area? COTG will be offering a free trial and 10% off for corporate packages of memberships. Moreover, we will also distinguish our service through the following features: - New member registration and exclusive intranet with a company profile (depending on the deal) - The opportunity to have a permanent station in the company based on number of memberships acquired and usage of the service. - Stats about the usage of the service for your employees. 12.7 What do we want the audience to do? 1. We want them to be engaged with our direct marketing campaign. 2. We want to increase the acquisition of corporate packages of memberships through the our special offers (free trial and 10% for corporate clients). 3. Build awareness about our exclusive services and offers for companies and, in the same time, increase our lead generation through our promotional and DM activities. 12.8 What is the budget and timeframe? 1 year of direct marketing campaign with total budget of $ 1,250,000. 12.9 What else is it essential that we know? We want to drive all the communications to our digital channels (promotional landing pages). The special offers also should be included in all of the pieces. Website and 0800 must be included (we will have part of the team trained to provide high levels of customer service for corporate clients. 12.10 Measures of success The effectiveness of the campaign will be measure through sales volume, ROI, response rates, conversion rates, leads generation.
  • 15. 15 13. Appendix C Creative Mock ups 13.1 Email Campaign (Stage 1)
  • 16. 16 13.2 Landing Page (Stage 2)
  • 18. 18 13.4 Landing Page (Stage 4)
  • 19. 19 13.5 Direct Mail (Stage 1)
  • 20. 20 13.6 Direct Mail (Stage 2)