Fashion Channel

How would you interpret the consumer and marketplace data if you were Dana Wheeler? I would first try to see if I could classify the data into various segments. The way channel is very universal among women. Hence, I would differentiate between the women viewing audience based on age, outlay capacity, dash nerdiness, etc. These allow be exercise subsets of the superset women viewers. Once, I watch the segments I would look for any noticeable trends in the segments that leave behind ground pelfable for the business.For example, some of the trends in the provided market data were 1. Approximately, 15% of the women viewers were Fashionistas who give lot of importance to fashion and follow the trends make fullly. These consumers testament go across a lot of money on fashion because they care for it (about 50% have an income much than $100k). 2. About 35% of the women viewers were Fashionistas and Planners/Shoppers. This segment consists of a more diverse consumer base. Se rving this segment lead definitely accession the ratings. Q 2) What is the expected outcome of each of the targeting scenarios? SCENARIO 1 financial and Viewership Since scenario 1 deals with a broader segment (Fashionistas, Planners & Shoppers, and Situationalists), the viewership is expected to growth. This annex in viewership will attract more advertisement deals. Hence, the overall ad revenue might increase as compared to 2006 (will depend on the rate of CPM). -SCENARIO 2 Financial and Viewership Scenario 2 deals with a laser specific single segment. The risk associated with this segment is that there will fewer people comprising it.If this military issue is less than the last years viewership, the viewership rating will drop. However, this scenario will attract ad deals which are involuntary to pay more CPM rates, hence, the earnings revenue will increase depending on the rating (0. 8% as compared to 1% in 2006). -SCENARIO 3 Financial and Viewership Scenario 3 is much m ore balanced than scenario 1 and 2. Scenario 3 stinker be considered as the middle of the spectrum in which scenario 1 and 2 rest the ends. Scenario 3 is neither laser specific nor includes a very large-minded consumer base.Hence, there are ample chances of increase in viewership (increased to 1. 2% from 1% in 2006). Together with the increase in viewership, it will attract more CPM for ad deals as compared to scenario 1 and hence the net revenue will be more than scenario 1. At the same time, this increase in net revenue might match the net revenue of scenario 3 if the increase in viewers match the deficit caused by the reduced CPM in case of scenario 3. Q 3) Develop a factual analysis of the segmentation options, and adjudicate the pros and cons of each. SCENARIO 1 Ad revenue/year saw a bare(a) increase as compared 2007 base. Cost of programming is the lowest. Pros Increase in the number of viewers since the channel is catering to a wider audience. Cons Since, there is no fa ctual change in the TYPE of viewers the ad deals will not have high CPM (thus reducing the net revenue). Also, this scenario will be to the highest degree prone to the loss in market share when competitors can come up with better programs. -SCENARIO 2 Huge increase in ad revenue couple with increase in cost of programming, which brought down the profit margin.Pros Segment consists of viewers who show high interest in fashion and hence will attract more CPM. Investing $15 one thousand million in improving the programs and related content will increase ratings. Cons Smallest of the tetrad segments. It is risky to target just this conclave since viewership depends heavily on brisk and interesting programs. Money has to be invested consistently to improve program content. SCENARIO 3 Huge increase in ad revenue couple with increase in cost of programming, which brought down the profit margin.Pros More wider audience and dual-targeting will turn back more viewership. The CPM is expe cted to increase from $1. 2 to $2. 5. Cons Additional $20 million investment on program specialization. Q 4) If you were Dana Wheeler, what would you recommend and why? I would recommend scenario 3 for the following reasons 1) Fashionistas have high interest in fashion and planners and Shoppers will ensure improve viewership. By incorporating both the segments the fashion channel can target both fashion-oriented and regular programming. ) Fashionistas will ensure CPM boost and planners and shoppers will ensure higher rating both of which will have positive influence on net income. 3) Although, additional $20 million was invested in creating new programs, the net income and profit margin was close to that of scenario 2. 4) Focusing on two segments will remove some realistic risks associated with focusing on just one concentrate segment such as low ratings, etc. 5) By choosing scenario 3 it is easy convince the present leadership to make changes in the marketing strategy as compare d to scenario 2.Q 5) Dana is filling the role of change agent in this organization. How should she manage the parole and meeting to be most effective in leading the group to make the right decision? I think Dana should choose scenario 3 over scenario 2. Although, the margins are almost the same for both the segments, it will be hard to convince the leadership to adopt scenario 2. This is because it will be a sudden change from the BROAD marketing strategy they got used to. Once, scenario 3 starts producing better results, it will be easier to convince the leadership to adopt scenario 2.