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Country Manager Simulation

Team 1 Performance Summary Analysis

Kara Degeorgis

on 29 April 2013

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Transcript of Country Manager Simulation

TEAM 1 PERFORMANCE SUMMARY ANALYSIS Ursula Librizzi Meredith Vandesype
Mary Dwyer Christian Llerena Kara Degeorgis Initial Marketing Plan Country Attractiveness Spreadsheet Most Attractive Countries Brazil
GDP growth - 5.2% / 7
Country size - 196.4 / 8
Tariffs - 21.0% / 5 Mexico
GDP growth - 2.0% / 9
Country Size - 108.7 /1
Tariffs - 0.0% / 8 Chile
GDP growth - 4.0% / 4
Country size - 16.5 / 4
Tariffs - 0.0 % / 9 Final Marketing Plan Simulation Revisions 1. Choosing Argentina over Chile
2. Opening a plant in Period 1
3. Increased attention to industry news
4. Used differentiation strategy with SKUs
5. Focused on lower prices while being conscientious of COGS Before Restart - Beginning of Simulation Restart to Period 5 - Middle of Simulation Period 6 to End of Simulation Adjustments to strategies, tactics and objectives
over the course of the simulation Reasons for Success Reasons for Failure 1. ignorance of simulation dynamics
2. not building a plant in period 1
3. copying competitor SKUs
4. too low of prices
5. ignored inflation or industry news
6. poor marketing
7. too large of a sales force Recommendations for the Future What did we learn? Initial Strategy - Enter Peru, Brazil & Chile
- Open production plant in Chile

Second Initial Strategy - Brazil, Mexico & Chile
- Open production plant in Chile - traditional and hypermarkets
- focused on families and healthy toothpaste
- plant built in period 2
- increased advertising costs and promotional budgets
- increased plant capacity in Chile to 100 million
- added sales force to each country
- doubled pricing in Chile
- took traditional market out of Mexico - hurt sales made decision in period 6 to restart simulation Third and Final Strategy - entered Brazil and Mexico
- Opened second production plant in Brazil
- entered Argentina
- lower campaign budget
- add a new SKU of economy/medium to market in Argentina
- lowered sales people and campaign budgets in both Brazil and Mexico
- added new SKU's to Brazil and Mexico
- updated all campaigns that were 3 years old
- net contribution negative but steadily increasing
- brand equity index (BEI) increased from 49 in period 1 to 60
Argentina = -3.9 Mexico = -0.5 Brazil = 13.4 Contribution Margins - increased amount of salespeople in each country
- drastically increased the MSRP on all 3 of our SKUs in Argentina
- added 20 million units of capacity to the plant in Brazil
- aimed to align prices more closely with competitors
- dropped prices in Argentina regardless of inflation
- lowered allowance for all SKUs from 5% to 4%
- introduced new SKU in Mexico in order to exploit a niche market
- adapted existing ad campaign in Mexico after 3 years running
- increase promotion budget in all countries
- increased the prices on all of our SKUs
- increased plant capacity from 130 million to 175 million Goals - turn a profit in Argentina and Mexico
- maintain a positive contribution in Brazil
- positive cumulative contribution margin net contribution higher than ever = 42.3
cumulative contribution margin = -12.4
BEI also increased from 60 to 66 1. GDP growth replaced by GDP

2. Peru replaced by Brazil

3. Opened plant in period 1 instead of period 2

4. 'Head to head' shifted to niche hunting RESTART - built a plant in period 1
- kept up with industry news
- priced according to economic climate
- chose competitors more wisely
- low cost strategy = steady sales increase
- differentiation strategy
- communication with other teams - deeply investigate country backgrounds prior to simulation
- acute attention to competitors' moves
- awareness of economic environments & market climates
- weigh factors that could affect your consumers' buying habits
- differentiate from your competitors
- strategically increase plant capacity - international marketing vs domestic marketing
- consumer needs vary by region
- standardization does not work for entering new markets
- industry news was vital to making new period decisions
- advertising and promotion were crucial to BEI
- exchange rates play role on pricing
- inflation is a domestic and international issue
- importance in differentiation
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