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Block AMay 1st, 2015
Final Presentation
Our Team
Jaewon BackChief Marketing
Officer
Mario BalabanChief Officer
Lexi ZafonteChief Executive
Officer
Shane O’BrienChief Finance
Officer
Ashley LamoreauxChief Accounting
Officer
Mission Statement
Decerto is a multinational corporation that strives to deliver the greatest value for the most competitive price.
Agenda
Where We Were
Where We Are
LessonsLearned
Where WeAre Going
IntegratedMarketing
A look into our past and why we were
there
Our current standing and how we got to be here
What we have learned throughout
the semester
Our plans for upcoming
years
Market strategy for entering a
new market
Where We Have Been
Where we have been
• Prices were as low as 12.0% less than industry average, often selling over $2 less than Team A
• Cost of Pairs Sold growing
Where we have been
• Ex: manufacturing costs• Not following low cost strategy
• Above industry average expenses
Where we have been
Why we were there
Strengths• Average Global
market share 16.73%
• Advertising• Retailer Support
Weaknesses• High costs• Low profit margin• Did not follow
strategy• Forecasting demand
Where We Are
How We Have Developed
• Best Value Strategy• Integrated cost-differentiation strategy• Best value for competitive price
• Plant Upgrades• A & C• Decrease reject rate costs and increase S/Q rating
Decerto increased its net profits by 161% in 10 years 161
%We also increased market capitalization by 196% in the same time 196
%
Increase in net profits
Increase market cap
Current Standings
Category StandingGame-To-Date Score 91
Net Revenue $421,841,000
Net Profit $109,377,000
Stock Price $299.54
EPS $14.58
Image Rating 60
Where We Are
• Consist growth after Y15• Better cost management strategy
Where We Are
• Increased revenue• Better overall performance
Where We Are
• Close with competitors• 50% of net revenues
• Steady decline since Y14
• Learned from past• Decreased marketing costs
• Advertising• Retail
Where We Are
• Declining costs and increasing revenue
Where We Are
• Highly correlated with net profit margin• Equity multiplier decreased• Total Asset Turnover increased
simultaneously
Where We Are
• Decerto was not highly leveraged• Always maintained an A- credit rating or better• Chose not to capitalize on low interest rate loans• Our long-term loans were paid-off by year 15
Why we are here
Strengths• Credit Rating• Competitive prices,
good quality products
• Model availability• Wholesale
Weaknesses• Low image rating• Low corporate social
responsibility• Private label• Relative high labor
costs• Stock-outs
Lessons Learned
Lessons Learned
• Defining and following a strategy
• Cannot rely heavily on advertising in order to grow a company
• Could have taken more risks in terms of loans and financial leverage
Lessons Learned
• Y15-20: Dividend Payout Ratio declining
• Y15-20: Stock price increased, but undervalued
Lessons Learned
• Y15-20: Decline in market share• Y15-17: Block in LA internet sales
Where We Are Heading
The Future
• Plans to increase capacity to combat stockouts• Increase Asia-Pacific capacity• Low labor costs
• Raise dividends to align to increase in stock
• Move into differentiation strategy
Integrated Marketing Plan
Country Industry Growth Potential
Economic Stability
Political Stability (risk of long-term investments)
Competition Feasibility Total
Germany 4 5 5 1 4 19
France 2 2 4 4 1 13
Russia 3 1 2 5 5 16
UK 5 5 5 2 3 20
Italy 2 2 3 3 2 12
United Kingdom•United Kingdom accounted for 14.1% of Europe’s footwear market value•$10.0bn, 72.1% of the market's overall value
Market Selection
• Multi-Segment Marketing Approach• Life-line of professional athletes
• Positioning• High-performance products
• loved by professionals• accessible to all sports enthusiasts
• Competition Pricing• Running Shoes (Top 10 UK)• £15 less
• Distribution• Exporting• Independent Retailers
• already existing distribution channels & loyal customer base
Segmentation, Positioning, & Pricing
