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Toronto Ultimate

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by

Anthony Ward

on 19 November 2012

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Transcript of Toronto Ultimate

After investing the initial 20,000 in Facebook’s advertising with no result, we can invest the rest (20,000 *1.25) = $25,000 CAD in EDGE radio advertising Contingency On the short term, to test the effectiveness of this strategy, TUC should invest $20,000 and “have a feel” of how Facebook users react. If successful, the rest of the money should also be reinvested to reap the benefits of market awareness. If no success is measured after the initial investment, we should resort to a contingency plan. Short Term Facebook advertising. Facebook can bring 1,538 new members through CPM. Revenue: (1,538 * 118.33) – 50,000= $131,991. Perhaps providing a special Facebook promotion will help sustain the short term growth from the influx of the new members towards a more long term period. Recommendation Alternative 3: EDGE radio
Pros:
- Very popular radio station in Toronto
- Advertisement is produced by the station
- Rock genre aligns with target market

Cons:
- Ads are short and not long lasting Alternatives Alternative 2: Toronto Star
Pros:
- Largest daily newspaper in Toronto - Large sports section

Cons:
- Very High costs
- Only 20 percent readers in the target market Alternatives Alternative 1: Facebook

Pros: - Fast and very easy to implement
- Great market reach / high usability
- Potential Spillover
- Low costs compared with other methods

Cons:
- People ignore ads online Alternatives
Acceptance from customers

Downturn Economic environment led low consumption

Reaction from competitors Key Uncertainties
Awareness and reputation

High quality service in GTA

Effective location Key Success Factors
Convert into US dollar: $50,000/1.25 = $40,000

As our target is 20-24 age

Assume 0.5% will sign up

CPC : ($0.22+$0.36)/2 = 0.29 average cost
$40,000/0.29 = 137,931 times
137,931* 0.5% = 690 members

CPM: ($0.10 + $0.16)/2 = 0.13 average cost
$40,000/ 0.13= 307,692 views
307,692 * 0.5%= 1,538 members Facebook
Bus interior :budgets about $50,000

465 million twelve-month ridership on the TTC

Targe market of age 20-24: 6.9 % in Toronto age demographics, assume 1/6 of 6.9% will sign up

Assumed that 0.2% sign up for a membership

Total prediction amount member: 465,000,000/12*0.2%*1.2%= 930 members CBS Outdoor Canada Our target market: 20-25 ages
800,000 weekly listeners
72% between the ages 18-44, assume half of them are age 20-25 which is 36%
$50,000 / $300=167 days
Assume 0.5% will sign up
800,000 * 36% * 0.5% = 1,440 members Edge
2008 operating budget: around $500,000

2009 Board commit: 5%-10% of TUC’s operating budget

Promotional budget: $50,000 Expense on promotion Break even = operating budget / unit contribution
= $40,000 / $20.22
= 1,978 members.

Break even sales: 1,978 * 65 = $128,586 Break Even Competing clubs will impact TUC's
market share and growth rate

Negative impact on development of the sport
Fracturing of population
Competing systems of rules

300+ other fitness clubs in the Toronto area
People have reduced time and income during summer months
Continuing effect of economic recession Concerns Everyman
Sport and social club
10000+ players annually
Numerous activities
Ulitmate frisbee four nights/week
Two seasons
Price ranges from $333 - $476 per season

WSS
Sport and social club
Offers sport clinics
$500 per season Competition cont'd Prospective Segments Current Segments Change TUC to make it more attractive to potential members

Proposals
Rules change
Single gender and beginner leagues
Smaller fields
Shorter games
Increase in price Current Strategies 2006 – 2008
Strategic plan halts turnover
Does not translate to significant growth

Reinvested money in website

Developed competitive teams
Teams provided a public face for TUC
TUC sponsored each team and donated field space
Teams volunteered time to TUC

Partnerships with local businesses failed to generate funds Past Strategies 1995 – 1997
30% per year
Membership in 1997 >1000

1997 – 2004
Growth rate slows but continues
Membership surpasses 3000

Concern over high turnover
Despite growth, loss per year is 500+ Growth Largest city in Canada

Over 2500000 people in the city
59% of playable age
43% of income is held by the playable age range

Median income 68110 in 2010

47% of population are visible minorities

Highly social culture Environment SWOT Analysis-con’t SWOT Analysis TUC is now the third largest Ultimate club
in Canada
TUC was incorporated in 1995 as a not-for-profit organization Current Position Word-of-mouth advertising
Pre-existing social networks
Advertising during a Toronto Argonauts professional football game (no effect) Current Strategies: Promotion TUC had pursued partnerships with various
local organizations Current Strategies: Parternship TUC developed and sponsored Toronto-based
competitive Ultimate teams competing in tournaments across Canada and the United States
representing Toronto on a national and international level Current Strategies: Sponsorship TUC has recently reinvested in
updating its website, offering registration
and tournament information hub,
monthly newsletter to members
and online archives. Current Strategies-: Website TUC was founded in 1980
TUC is a non-for-profit organization
TUC became the third largest Ultimate club
boast membership of both recreational
and competitive players Background Increase growth rate to 30% each year
have at least 10,000 club members in next
summer season Main Goal Develop a marketing plan
Attract a specific market segment
Develop stronger ties with young generations
Expand to new demographics Objectives Toronto Ultimate Club’s growth has slowed down, since the entry of for-profit clubs in the Toronto area Problem Statement Prepared and Presented by

Anthony Ward
Rodney Conroy
Lin Yang
Yunwei Xia TORONTO ULTIMATE CLUB
Target market segment for UTC: 1000,000 * 22% * 20% = 44,000 readers
Assume 3% of readers will take action
Total prediction member amount would be: 44,000 * 3% = 1,320 members Toronto Star Total revenue/player = membership fee + registration fee
= $65 + $53.33
= $118.33

Unit variable cost = Average cost of field for each team / 15 teams
=$1,471.25 / 15
= $98 per member/per hour.
Total play hour is: 15*2.5+8*2= 53.5 hours.
Average cost of field for each team:($55 * 53.5)/ 2 = $1,471.25 per term/per field

Unit contribution = Revenue - Variable costs
= $ 118.3 - $98= $20.22 per unit

Assume In 2009 the board will commit 8% of TUC’s operating budget
Fixed cost: $500,000* 8%= $40,000 Financial Analysis Three primary sources:
Recreational Sporting Club (RSC)
Everyman Sports (Everyman)
West Side Sports (WSS)

RSC
Variety of sporting clubs and fitness clinics
Frisbee age limit is 19+
Variety of coed and women's leagues
Two seasons per year
539/season, 1129 for both Competition
Full transcript