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ENTREPRENEURSHIP

Product Launch and the Business Mind

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The business mind brings the product from the prototype stage to the production phase and, finally, to its ultimate destination, the marketplace. The product must be made shop-ready for commercial purposes.

The business mind must determine the best way to maximize product sales to its target market. The right distribution and salespeople should be tapped and deployed. The fourth and fifth technical specifications were addressed as follows:

    • Fourth: Use of subcontractors, namely, Tahanang Waking Hagdan.
    • Fifth: Entrepreneurs supplied the materials to the subcontractors including the pre-assembled electrical contraption.

The entrepreneurs received invaluable comments from the subcontractors and the production experts they consulted.

In the case of Lampturn, as soon as the entrepreneurs approved the final prototype, the next step was to test market the product prototype. The test was conducted in two phases. The first phase consisted of two focus group discussions (FGD) and selling activities at Christmas bazaars. The second phase involved the placement and selling of the lantern at alternative outlets to determine their price threshold and potential sales volume.

The first FGD consisted of potential consumers with ages ranging from 15 to 50. The responses in the first FGD were favorable.

    • The fish design was particularly liked. Other designs like planets, angels, and Christmas motif were recommended.
    • The FGD suggested a price range of ₱500.00 to ₱1,200.00. The product could be used as a home decor for their own homes or as gifts to friends.
    • The FGD raised the issue of safety and recommended that instructions be given on how to handle the electrical component.

The second FGD consisted of interior designers for product enhancement purposes.

    • The designers recommended that the lantern be sold in home decor stores rather than novelty shops to get a price premium.
    • They suggested additional designs like carousels and flowers.
    • They saw the lantern as a living room or bedroom lighting display that must have a fireproof certification.
    • They thought that the lamp should be packaged in a strong box to protect it from breaking.

In the pre-Christmas bazaar sales, the entrepreneurs wanted to:

    • see how the product would move in the marketplace;
    • who would buy it and for what purpose;
    • at what price range; and
    • with what customer comments.

In the five bazaars:

    • Twenty-six lamps were sold.
    • Eight percent of the buyers were women, ranging from teenagers to young and older mothers.
    • The introductory price of ₱800.00 was readily accepted.
    • Fifty percent of the lanterns were intended as gifts.

The second test marketing phase attempted to place the product in several commercial outlets, namely in:

    • home decor and home furnishing stores;
    • novelty and gift stores;
    • lamp and lighting fixture stores; and
    • children’s toy stores.

Novelty stores tended to price the lantern between ₱895.00 and ₱1,200.00 to generate faster turnover. The home decor stores priced the product between ₱1,200.00 and ₱1,400.00 (although one store was able to sell them at ₱2,000.00 per lantern). It was not difficult to sell the products to the stores. Fifty-eight units were sold in the first 23 days, indicating good market prospects. Because of their test marketing experience, the entrepreneurs positioned the product:

    • as a novelty home decor item;
    • for children’s bedroom or for living room display; and
    • for women buyers aged 15 to 50.

The findings of the second test marketing phase enabled the entrepreneurs to make a good marketing plan that would maximize their revenues and profits.

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