Grand Central Publishing

Dewey Market Attack Plan

Consultants: Ema Kamara, Bhagirath Gaonkar,

Devanshi Patel, Nitish Gupta
Agenda
Management Summary
Target Segment(s) Analysis
Broad Appeal - ‘Chicken Soup for the Soul meets Marley & Me’
A gentle touching story that harkens back to simpler times

Appeal Stretches Beyond Cat Lover Inspirational Appeal

Lassie the Dog

One of the longest running
dramatic series on
television1954-1973 “Honest devotion to
extraordinary things in
ordinary lives”.
Surprised Kitty •200 titles in this series
62 million YouTube views •5 million copies a year

Flipper the Dolphin

Movie turned to network
show that ran 3 years.
Dubbed the "aquatic Lassie".
Target Segment(s) Analysis
5M Total Market Potential
Taking into consideration*potential
5mm Totalfrom Target
two segments and accounting for overlap.
Segment
Profitable Distribution Channels
Distribution coverage through 4 key channels (Retail, Direct to Consumer, Online
and Book Clubs), will give access to our targeted consumer segments.
Promotional Activities to
Reach Target Segments
Multi-faceted Promotion with key collaborations to extend marketing reach.

New York Times Bestseller List

•Books must be strategically placed in Bookscan bookstores

Back to the Libraries:

•Launch Dewey in collaboration with the American Library Association (~121,785).

“A Gentle Touching Story That Harkens Back to Simpler Times”

•The Story of Edgar Sawtelle, a book about a mute boy and his dogs by a first-time novelist -
publisher ordered 750,000 "Oprah versions" from the printers.

CSR Initiatives
•Donate a share of proceeds to Animal shelters and PETA

Licensing of Dewey Image

•License Dewey image to be put on cat food items.
Brand Franchise Opportunities
Capitalize on the success of the book with franchise opportunities.
Performance & Risk Analysis

Ideal Case Worst Case

Bid Price - $1.5m Bid Price - $2.75m

30,000 books sold

 2 million books sold
Marketing Spend $2m
Marketing spend $4m
 Phased Marketing Budget  Phased Marketing Budget
 $2m for initial push
 $2m after 500,000 books sold
APPENDIX
 ROI Tree
 Pricing Options and Recommendation
 Bid and Breakeven Volume Analysis
 Profit & Loss Analysis
 Market Sizing Analysis
 Sensitivity Analysis
 6 Ps
Appendix (ROI Tree)

*To be converted to Fixed

cost
 Market Sizing
CAT LOVERS
MARLEY & ME DEWEY THE CAT

Households w/Dogs: 43.02M Households w/Cats : 37.46M

40%* # of Book Readers: 17.2M # of Book Readers: 14.9M 40%*
50%* # Adult Hardcover Readers: 8.6M # Adult Hardcover Readers: 6M 50%*
# Books Sold: 1.9 M Unit Sales Potential: 1.32M
Market Share: 22%

Inspirational
CHICKEN SOUP FOR THE SOUL DEWEY THE CAT

Trade Market Sales: 300M Trade Market Sales: 300M

Non-Fiction Unit Sales (US): 120M Non-Fiction Unit Sales (US): 120M
40%* Inspirational/Meditation NF: 48M Inspirational/Meditation NF: 48M
40%* Chicken Soup Unit Sales: 5M Chicken Soup Unit Sales: 5M
Market Share: 10% Dewey the Cat: 3.5 M 70%*
Market Share: 7.3%

*Assumptions
Pricing Options and Recommendation

Price Methodology

Use comparable book Marley & Me ($21.95). Adjusting for

$22.85
inflation(4.1%), Dewey the cat can be priced at $22.85

Price based on the number of pages. Generating an average for

$20
the top 10.

Price based on the number of pages. Generate an average for

the non-fiction books in the top 10. Can also act as a special
$18
introductory offer to generate interest. (Marley & Me needed
time to generate the following that it eventually got)
 Breakeven Volume, Bid Pricing and Marketing

Overhead CM/ book

$90,000 $7.53

  Royalty Fees                    

Marketing Budget $250,000 $500,000 $750,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000
$250,000 78,353 111,554 144,754 177,955 211,155 244,356 277,556 310,757 343,958 377,158 410,359
$500,000 111,554 144,754 177,955 211,155 244,356 277,556 310,757 343,958 377,158 410,359 443,559
$1,000,000 177,955 211,155 244,356 277,556 310,757 343,958 377,158 410,359 443,559 476,760 509,960
$1,500,000 244,356 277,556 310,757 343,958 377,158 410,359 443,559 476,760 509,960 543,161 576,361
$2,000,000 310,757 343,958 377,158 410,359 443,559 476,760 509,960 543,161 576,361 609,562 642,762
$2,500,000 377,158 410,359 443,559 476,760 509,960 543,161 576,361 609,562 642,762 675,963 709,163
$3,000,000 443,559 476,760 509,960 543,161 576,361 609,562 642,762 675,963 709,163 742,364 775,564
$3,500,000 509,960 543,161 576,361 609,562 642,762 675,963 709,163 742,364 775,564 808,765 841,965
$4,000,000 576,361 609,562 642,762 675,963 709,163 742,364 775,564 808,765 841,965 875,166 908,367
$4,500,000 642,762 675,963 709,163 742,364 775,564 808,765 841,965 875,166 908,367 941,567 974,768
$5,000,000 709,163 742,364 775,564 808,765 841,965 875,166 908,367 941,567 974,768 1,007,968 1,041,169
$5,500,000 775,564 808,765 841,965 875,166 908,367 941,567 974,768 1,007,968 1,041,169 1,074,369 1,107,570
$6,000,000 841,965 875,166 908,367 941,567 974,768 1,007,968 1,041,169 1,074,369 1,107,570 1,140,770 1,173,971
$6,500,000 908,367 941,567 974,768 1,007,968 1,041,169 1,074,369 1,107,570 1,140,770 1,173,971 1,207,171 1,240,372
$7,000,000 974,768 1,007,968 1,041,169 1,074,369 1,107,570 1,140,770 1,173,971 1,207,171 1,240,372 1,273,572 1,306,773
$7,500,000 1,041,169 1,074,369 1,107,570 1,140,770 1,173,971 1,207,171 1,240,372 1,273,572 1,306,773 1,339,973 1,373,174
$8,000,000 1,107,570 1,140,770 1,173,971 1,207,171 1,240,372 1,273,572 1,306,773 1,339,973 1,373,174 1,406,375 1,439,575
$8,500,000 1,173,971 1,207,171 1,240,372 1,273,572 1,306,773 1,339,973 1,373,174 1,406,375 1,439,575 1,472,776 1,505,976
$9,000,000 1,240,372 1,273,572 1,306,773 1,339,973 1,373,174 1,406,375 1,439,575 1,472,776 1,505,976 1,539,177 1,572,377
$9,500,000 1,306,773 1,339,973 1,373,174 1,406,375 1,439,575 1,472,776 1,505,976 1,539,177 1,572,377 1,605,578 1,638,778
 What if it works – Best Case P &
Ls

Sales Revenue        
Gross Copies Published 7,575,758 5,303,030 3,030,303 5,303,030
Sell Through 66% 66% 66% 66%
Net Sales 5,000,000.00 3,500,000.00 2,000,000.00 3,500,000.00
Retailer Discount 50% 50% 50% 50%
Gross Revenue $ 53,723,863.64 $ 37,606,704.55 $ 21,489,545.45 $ 37,606,704.55
   
     
Variable Cost  
     
Paper, Printing & Shipping $ 7,678,787.88
$ 5,375,151.52 $ 3,071,515.15 $ 5,375,151.52
Freight & Shipping $ 1,484,848.48
Author Royalty (less $ 1,039,393.94 $ 593,939.39 $ 1,039,393.94
advance) $ 12,089,261.36 $ 7,637,482.95 $ 3,185,704.55 $ 8,887,482.95
Total Variable Cost $ 9,163,636.36 $ 6,414,545.45 $ 3,665,454.55 $ 6,414,545.45
Contribution Margin $ 44,560,227.27 $ 31,192,159.09 $ 17,824,090.91 $ 31,192,159.09
         
Fixed Cost        
Author Advance $ 2,750,000.00 $ 2,750,000.00 $ 2,750,000.00 $ 1,500,000.00
Marketing Cost $ 4,000,000.00 $ 4,000,000.00 $ 4,000,000.00 $ 4,000,000.00
Overhead $ 90,000.00 $ 90,000.00 $ 90,000.00 $ 90,000.00
Total Fixed Cost $ 6,840,000.00 $ 6,840,000.00 $ 6,840,000.00 $ 5,590,000.00
Net Profit $ 25,630,965.91 $ 16,714,676.14 $ 7,798,386.36 $ 16,714,676.14
What if it fails – Worst Case P &
Ls

Sales Revenue      
Gross Copies Published 181,818 181,818 45,455
Sell Through 66% 66% 66%
Net Sales $ 120,000.00 $ 120,000.00 $ 30,000.00
Retailer Discount 50% 50% 50%
Gross Revenue $ 1,289,372.73 $ 1,289,372.73 $ 322,343.18
       
Variable Cost      
Paper, Printing & Shipping $ 184,290.91 $ 184,290.91 $ 46,072.73
Freight & Shipping $ 35,636.36 $ 35,636.36 $ 8,909.09
Author Royalty (less advance) $ - $ - $ -
Total Variable Cost $ 219,927.27 $ 219,927.27 $ 54,981.82
Contribution Margin $ 1,069,445.45 $ 1,069,445.45 $ 267,361.36
       
Fixed Cost      
Author Advance $ 2,750,000.00 $ 1,500,000.00 $ 1,500,000.00
Marketing Cost $ 2,000,000.00 $ 2,000,000.00 $ 2,000,000.00
Overhead $ 90,000.00 $ 90,000.00 $ 90,000.00
Total Fixed Cost $ 4,840,000.00 $ 3,590,000.00 $ 3,590,000.00
Net Profit $ (3,770,554.55) $ (2,520,554.55) $ (3,322,638.64)
 6 Ps – Summary Strategy Grid
Component Strategy/Tactics
Objective(s) Win the bid, reach broader than pet lover audience, be profitable
Business, Marketing

People Pet Lovers ( 22% market share), Readers of non-fiction (7.3% market
Market Size, Targets share of inspirational book enthusiasts)
Product A gentle touching story that harkens back to simpler times. Build on this
Characteristics, underlying tone of Dewey’s story to resonate with the troubled times of
Benefits today
Price Comparable pricing to top sellers with a 50% retailer discount per
Wholesale, Retail standard.
Place Distribution coverage through 4 key channels (Retail, Direct to
Distribution Strategy Consumer, Online and Book Clubs)
Promotion Niche Magazines, Book Clubs and Library Associations, CSR initiatives
Methods, Resources (PETA, Animal shelters, NGO’s, Library Associations), Television
Celebrities (Oprah, Martha Stewart etc.), Licensing
Performance Sensitivity analysis with comparable book sales from top selling
Revenues, Profitability inspirational titles(Chicken Soup series) to books about animals (Marley
& Me, Tales of a neurotic cat etc.)