Question 1:

Urban company plans to launch a new service for “home delivery of pet-care services” in
India. The marketing team of the company approaches you to conduct a market opportunity
analysis. Conduct a market opportunity analysis for the new service and submit it in about 3
pages.

Solution:

The best industry to begin business in this decade is the pet industry. Growing population and
increase in the income has given way for every family to either adopt or purchase a pet. From
dogs to birds, the availability and breeding has grown twice more than the previous decade.
To be precise, the recent growth in the demand for pets is because of the rise in awareness,
many NGO’s and PETA has helped in giving people the right information and required
support as needed. Upon researching we find that, as of 2018 there are nearly 17 million pet
dogs and 1.5million pet cats in India. India being a developing country and the population so
vast, the market for pet care is substantial. Given the numbers, we can roughly say the pet
food segment is of good potential but now, in the pandemic, many pet parents would want
their pets to be taken care of at home than having to travel to pet care centres.

The recent #adoptdontshop and also the Prime Minister of India coming out in support of
adopting Indian Street Dogs is going to give rise to the “Pet dogs” population in the near
future, which may lead to every household having 2 or more dogs. The pandemic has affected
every industry, including the pet care industry, the industry began to crack since it was run by
increasing purchasing power of the generation, increase in nuclear families and because of
the pandemic everything fell off the cliff. The owners lost purchasing power, loss of jobs
eventually paving way to less income. In an era of virtual growth, pet home services are
going to revive the industry.

Having kept all these in place to help us understand the market opportunity for the new
service of pet care that Urban Company has planned to launch. To understand the market
opportunity, we are look into 4 broad factors that influence the analysis: -

1. Market size.
2. Competitors strategies and services
3. Marketing programmes to meet market wants
4. Identifying and relating industry strengths with Urban Company’s strength and
weakness.

The root of the market analysis is to understand the market demand. As mentioned earlier, the
increase in pets per household and awareness to treat them as equal as humans (pet
humanization), many pet owners want the same for their pets that they want for themselves.

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For instance, as the other business segment of Urban Company is to provide Salon at Home
for both men and women, pet owners would be delighted to have the same for their pets at
home with the same level of sanitization and care as taken for humans.

Owing to the pandemic, Urban Company has benefitted in a way showing a leap of 103%
revenue after the lockdown mainly coming from Wellness and Salon at Home services. Pet
care not being very different from these services can be forecasted to add to the revenue as
well. Until life comes back to normal and perhaps even after, because of the fear, many
families would prefer to get services home than having to step out to meet their needs. Taking
advantage of the situation, a launch of this kind during this time is going to make an impact
on the market share of Urban Company.

By not restricting itself to only pet grooming, Urban company can look at other services such
as medical(veterinary)services, pet sitting, pet walking services which do not restrict the
reach of the firm. Thus, non-medical services as the ones previously mentioned plus training
them is going to drive this segment.

The economy opening up and picking can give consumers a slight increase in the disposable
income to spend extra rupees to avail services. As earlier, Urban Company began at low
prices compared to its competitors doing the same for pet services can help grab the market
share much smoothly.

Urban Company can tie up or partner with various other renowned pet care centres to provide
services that, pets were earlier catered to on visiting the centre. This is not only going to
increase job availability but also help revive the economy and ease the fears of those who are
sceptical in choosing an online platform for their pets.

The next area of focus must be on Segmentation and Industry analysis. Urban company can
segment its services based on: -

 Type of pet.
 Type of service
 Type of regions in India.

Given the Indian culture and perspectives, we may see a lot of preference for dogs and cats
but Urban Company must not build boundaries on what type of animal they want to cater
services to. Secondly, the type of services as mentioned above it is important to be able to
meet all requirements under pet care for the market reach. Lastly, the regions of focus or
different regions in India would be to broadly categorize on which part of India has the most
animal population as pets and where there is demand for these services.

As mentioned earlier, pet care industry is vast and from the outside might look like a small
town but has many players but in case of home delivery of pet care services we have a very
few well-funded start ups that are trying to meet the demand because of lack of visibility. In

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 case of Urban Company, visibility is easy because Urban Company is now a well-known and
established convenience junction. The near future of pet care is predicted to grow with
334.3million and a CAGR of 13.9% in the next 5 years. With pet owners being more
concerned of their pets and their food intake, the demand for pet food is making more
revenue than the grooming services.

Indian pet care market is growing at records because of urbanization and willingness to widen
their minds to adopt pets. Study shows, in India dogs are more preferred than any other
animals as pet. So overall within these types, firms generate more revenue from dogs and
their pet care.

Finally, Competitor Analysis. Since Urban Company is a well established and has generated
massive revenue since the lockdown the competition would relatively be less as Urban
Company as already gone past that phase of reaching out to the masses. Urban company can
partner with small-medium enterprises that provide animal food and accessories and help
deliver them to the end customer with benefit on both sides. However, since the pandemic
many veterinary hospitals and clinics are also going virtual and providing home services.
Urban Company can also act as a bridge between these hospitals and the end pet owners to
provide services as requested to Urban Company.

To understand the opportunity further we must also consider the advancements in

Technology and Artificial Intelligence which can play a role from the set up to reaching out
to the target audience to delivering the right quality pet service. Urban Company began from
a cloud-based app, now has all types of services under one umbrella. The firm has allowed
consumers to sit at their convenience and book for services as and when required at their
specific time preference. From the pet owner’s perspective, technology has gone way beyond
the previous decade. Pet owners can track their pet’s timeline through a chip and also monitor
their heart rates on the go. Even during occasions when the pet is left alone at home or under
someone’s responsibility, the owner can monitor and look at their pets as they are away.

To conclude, the below PESTEL analysis can put the analysis in perspective.

 Political: The Indian Constitution has provisions particularly for pet owners, giving
everyone the freedom to own a domestic pet. These provisions do not restrict people
based on their salary and level to own pets. Hence, we understand that the growth for
pets and their well being is a passively increasing market.
 Economic: As Urban Company gained over 100 % revenue after lockdown which contributed
to the economy from the informal sector showing signs of revival, the economic factor
revolving around the home delivery of pet care services is positive. From the firm’s
perspective the cost of setting up this service should roughly cost about 25-30lakhs or much
less if they partner up with firms with the equipment’s required for the services.
 Social: From the society perspective, many pet owners own a dog to show their status. In an
era of social media, urban company grew its popularity in the beginning stage through social
media. This platform helps reach as many customers since in this virtual world, every

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 second person owns a smartphone with accessibility to social media and news. Animals are
said and proven to provide companionship and support to their owners giving people more
reasons to be pet owners during these times of distress.
 Technology: As mentioned previously, technology and artificial intelligence are the now and
future of the business. We are dependent on technology in some way or the other and the
advancements will always get the better of us. New grooming tools for animals, New
feeding tools for animals, these are innovations that Urban Company must adapt to in order
to sail smoothly without competitors taking over the market share.
 Environmental and Legal : These two factors in the analysis are simple and it goes without
saying as to how these Home delivery of pet care services is harmless to the environment
and is in fact reducing the commotion as there are going to be less people moving out of
their house to reach their pet care centres.
Legal aspects for Urban Company is not going to take much of its effort as mentioned
earlier, the firm is set up and will only have to rework on the framework and structure of its
business segments since the new business regulations may differ from that of the services
already offered by Urban Company.

Overall, the firm must go ahead and take this opportunity to launch the service and widen its
horizons. By adopting this business, Urban Company will be a conglomerate of services
catering to vast majority of the Indian Population. Pet humanization has brought growth and
competition in the pet industry. Many start-ups are catering to the needs of pet sitting, pet
walking, pet boarding, grooming and training as well. This opportunity should be a smooth
sailor for Urban Company because of the advantages it carries from the brand.

Question 2:

Marcus (owned by Goldman Sachs) is an “internet-only” commercial bank and the bank
plans to remain so in future as well. That means no check books, no ATM network, and no
branches. The bank offers all other banking services including Savings account, Deposit
accounts and Advances/loans of all kinds. As of now the bank is not operational in India.
Considering that the bank gains required permissions to operate in India, suggest

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segmentation, targeting and positioning strategies (STP) to the Bank’s India marketing team
in about 3 pages.

Solution:

Goldman Sachs launched Marcus in 2016, an online platform that offers all commercial
banking activities to clients without personal visit to the bank. This facility paved way for
more customers and Marcus accumulated $50 billion deposits as of 2019. To spill it out,
Goldman Sachs is not a “consumer” only bank, it is one of Wall Streets best known names
for investment banking. The roots of Goldman Sachs come from Investment Banking,
whereas Marcus is only an online bank without branches wherein the customer will not have
to visit a physical bank to access the account. To access, one must connect Marcus bank
account to the usual bank account and gain access to mobile banking through the Marcus
Banking App. In order for Goldman to widen its Marcus reach to the Indian Market, the
below mentioned Segmentation, Targeting and Positioning (STP) strategies should be of
help. The concept behind the STP is to discover, target customers and position the idea in the
market. Hence, by segmenting the market, targeting the right customers for their needs and
wants and rightly positioning the online banking service in the market place, Marcus can
achieve growth and market at a faster rate.

Segmentation is that approach where in the market is divided and catered to. In other words, a
similar market or homogeneous market is further divided into various homogeneous markets
likely having the same preferences. In case of banking, the most preferred is the segmentation
by demography but however it must be based on the expectations and benefits customers
want from such services. In the era of digitalization, we must also look out and filter out
customers who do not prefer online banking maybe for convenience purposes or user
friendly.

A suggestion to Marcus would be to divide the market into 4 segments, demographically,

behavioural, geographically and psychographic terms. As per market, demographically
segregating the customers would be the first step for instance, based on occupation, age or
even marital status. As per records, the market within an age group of 18-55 would prefer an
online banking service but that being a homogenous market in itself, further dividing them
into the working class, students and business class would further segment the market and help
cater to their specific needs. Overall, segmentation is said to be a success when it comprises
of Group Identity, methodical behaviour and Efficiency potential. These revolve around the
questions, are they similar within their divided segments? Do they react similarly? How long
is the segment going last? And also, what is the cost of each of reaching out to these clusters?
All these questions align to achieving the market share and sales as Marcus achieved over the
years outside India.

Targeting the right customers for the services provided by Marcus should be the next step
after segregating them. It is important to segment first before targeting is to avoid the
unnecessary costs, reduce time consumption and to focus on right service to right customer

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instead of reaching out to everyone at the market to only have less than the stipulated market
come back for service. Hence targeting will help in focussing on those market customers who
are going to help Marcus achieve the goals and growth as achieved in areas apart from India.
Considering the pandemic and other factors governing the decision making of customers
during these times of distress, the customers are more likely to have services on their
fingertips than to go out to a physical bank which during the Pandemic are also functioning
on 30-40% capacity. Which shortens the availability of staff for customers and also, increase
in the time spent by customers at the bank.

Marcus must target its customers based on 3 broad strategies.

 Standardization: Same type of services for all kinds of target audience or segments. For
Marcus this should ideally be their strategy for they are still newcomers. Marcus must
lay out all services provided to all customers within or outside the market segment.
 Differentiation: If Marcus chooses to differ its services online banking services from
market segment to another, they would prefer going with this strategy. But its not
advisable as it hinders the market capitalization for Marcus.
 Focus: It’s a market combination of both Standardization and Differentiation where
Marcus can specifically focus on certain segments requiring certain services. For
example, Marcus can target a market segment with age group between 18-30 to apply
for loans and perhaps focus on providing better returns on investments they choose to
make.

Questions to ask while creating a portfolio of right customers, are they going to generate the
right return on investment? Around how many numbers of deposits or services do the target
audience require? Are the target audience well aware of the risk they will have to encounter?
It is important to study the size and growth of each segment market and compare each market
with one another and therefore prioritize based on the goals of Marcus. As best advised to
perform a PEST analysis in the process of choosing the target audience and understanding
other factors that govern their requirements, it can save Marcus from making wrong
decisions.

In terms of differentiating between the market segments, if Marcus sees potential in one
market segment over the other it is generally advised to choose the one most profitable but
here, since Marcus is yet to step foot into the Indian Market and establish its base in India
such differentiate could cost Marcus on losing out on market share. On the other hand,
Marcus must also focus on the lifecycle of the customers they are targeting. This must be
based on estimate and forecasting. While everything is available on the internet, there is
technology and artificial intelligence which can be of help in reaching out to customers
looking on search engines for specific words that relate to the services provided by Marcus.

To conclude on Targeting, the factors to keep in mind while reaching out to the target
audience are, the size of the market segment, the qualitative and quantitative differentiation
between the different market segments, the costs involved in deploying activities to reach out

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to these market segments, their accessibility and their availability to be able to receive and
send signals, finally the different segments requiring different benefits.

Positioning being the final stage of STP, it is how Marcus wants to present itself in the
market and position itself. Marcus carries a brand with it which holds a reputable position in
the banking sector, which is going to act as a driving factor for its popularity and market
capturing. It is essentially the mix and match of strategies and segmentation around which the
services to be provided by Marcus are going to be marketed to the various segments in focus.
For Marcus to gain competitive advantage over existing online banking apps, they must
differentiate themselves from the ones already in the market, a Unique Selling Proposition.
Marcus perhaps may have to come up with new features and services that are beneficial for
everyone. Marcus can focus on the agricultural side of the industries which holds most of the
loans and deposits of small amounts.

The question Marcus must investigate during positioning is – Why should customers take
services from Marcus than its already existing competitors in the Indian Market? What is
going to differentiate Marcus apart from the brand image it carries of Goldman Sachs?
Principles governing these questions must be on the lines of – Understanding what exactly
the customers prefer? What are the already existing apps not offering? What can be made
better of the services already provided by Marcus? These can be listed out as and under –
Points of Differentiation and Points of Parity. This model is said to be a success when the
online banking is positioned correctly and the target market is convinced with the services
provided. Having kept these factors in mind, the other factors to consider are discussed
below.

Marcus can differentiate in providing various loans for various specific needs. During the
pandemic with loss of jobs and less income, the customers may want to take up loans for
various reasons. The most affected are the ones running out of their savings and having no
jobs, the focus of Marcus can be on this segment where the payback period is as per their
convenience and as they accumulate enough to pay back. Given the new RBI guidelines for
banks, which must be adhered even by Marcus, the most can be made out of this opportunity
to reach out to as many customers as possible. Like in countries abroad, insurance plays an
important role in India perhaps for taxation purposes and health benefits. Marcus can
streamline and partner with hospitals to make transactions flow smoothly and benefit both the
receiver and giver.

Now that, the travel is eased out and the availability of physical cash is less, Marcus can
facilitate and provide help for the travellers by acting as a middle man between the customers
Indian Bank and Foreign Bank which may or may not be Goldman Sachs.

Overall to conclude, Marcus can make the most of the available services provided in the
Indian economy given the current situation. Banking being a sector which monetarily caters
to the needs to people belonging to various levels of income, Marcus can achieve the market

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share and growth as desired by segmenting, targeting and positioning the online banking
services.

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