Question 1

What customers should InvestorSoft pursue with its new service? Why?

Target Segment Company Size

Segment
Micro Cap

Characteristics
59 % of companies in Canada Stock exchange CEO acts as the IR manager Most potential to benefit from IR High Sales cost since they have to target more number of customers

Small Cap

24 % of companies in Canada Stock exchange Already invested some time & money for IR activities No single method of IR management dominated
8 % of companies in Canada Stock exchange Credibility & image quite important Would prefer premium products 9% of companies in Canada Stock exchange Already concentrated heavily on IR Separate team of professionals and operating staff

Mid Cap

Blue Chip

Target Segment - Geographic

Area
USA Canada

Characteristics
Large base of potential clients Companies more willing to subscribe according to the predictions Concentrated only in a few cities (Toronto , Calgary)

Recommendations
Investorsoft should start targeting Small Cap and Micro Cap companies in Calgary city of Canada (20% of publicly traded firms in Canada)

Together comprises of 85 % companies listed in Canadian Stock exchange. Since the pricing doesnt vary much volume plays an important role Least challenging to sell the product as only the functionality is important to the Micro cap companies Many of the firms does not have an effective solution (Almost 65 % of micro cap have very inadequate IR website) Lack financial resource for in house development or hire an in house personnel The CEO acts as the investor relationship manager in MicroCap. An interface of this kind would enable him to have free time to concentrate on expansion of sales and operations

Recommendations
The competitor penetration ( IntegratIR) in Micro segment is extremely low ( Less than 5 %) and the service provided (Eg. Being invisible to the end user) is much better The proposed pricing of $295 to $395 (Investorsoft Standard) and $595 (Investorsoft Premium) is optimum for these two segments Small cap companies can be used for brand building and micro cap companies will help in achieving the sales target Concentrate on Calgary city of Canada (Approx 500 firms 295 Micro Cap & 120 Small Cap) since the business centers are concentrated in a few major areas and Investorsoft will have the closer to home advantage

Question 2
What are the pros and cons of distributing through intermediaries? Does this make sense for InvestorSoft? Why or why not?

Pros and Cons of Distributing via Intermediaries:

ADVANTAGES 1. Minimization of initial set-up cost

DISADVANTAGES 1. Need extensive training familiarization with product &

2. Can provide critical (or neutral) view 2. External sales force may not be about products aligned with Investorsofts objective 3. Beneficial when customers dont exist contacts with 3. Shifts locus of control outwards

4. Capability to diversify product 4. Steep discount demands (when offering (multiple feature packaging), intermediaries have many customers) thus making proposition more attractive 5. May not create brand awareness for Investorsoft.

Factors affecting Choice of Distribution Channels:

TARGET CUSTOMERS

PRICING

COMPANY STRATEGY

DISTRIBUTION

COMPETITORS

COLLABORATORS

Does this make sense for InvestorSoft?

NO, because:
Brand awareness may be little, or may not be created at all Intermediaries would be useful when catering to US markets, & Blue-Chip companies Discounting & Integration may result in diluting brand (Brand Erosion) Adds extra layers of profit margins, thus reducing Investorsoft's margins Conflicting strategies of web developers & InvestorSoft

Question 3
What promotional strategy would you recommend to Chris Bolivar? Be sure to specify how much you would spend, on what, and why.

Promotional Techniques
Media Direct Mail Cost $5 for a regular envelop(letter + Brochure) $20 for a large envelope(Folder package +Complete information) $500 Very Small $750 Small $1000- Medium $1450 - Large $ 5000 for attending annual general conference $5000 for displaying investorsoft booth

Print Advertisements

Conference Exhibits

Industry Promotion
Personal Selling

$150 per user for try outs

$150 per prospect for sending private links $600 per prospect personal demonstration

Brand Building Recognition

Not to be tried without brand building

Marketing budget allocation (Total budget = $25000)

Micro Cap companies
Direct Mail (Assuming 20 % success rate) > 295*5 = $1475 Personal Selling(Private link and over phone) > 150 * 60 = $9000

Small Cap companies

Direct Mail (Assuming 20% success rate)> 120 *20 = $2400 Personal Selling > 350 * 24 = $8400

Print Advertisements
Small advertisement in 7 issues of CIRI -> 7 * 750 = $5250

Proposed total Cost = $26525

Question 4
How should InvestorSoft price its service?

 Investorsoft should look at the value pricing option of $395 per month & the premium pricing of $595 per month For small cap companies who spend around $750 a month, Investorsoft would help save a minimum of $155 monthly