Profitability Analysis and Market Entry of DevCo

Case Study- 10.2_Financial_Consulting_Case_mock
Name
Date
1 What is the market size for this new magazine?
Marketing information: Market is not growing.
Competition is made up of : GQ: 60% of the market; Other magazing/fragmented: 40% Survey data shows that we can capture 5% of the market
The goal that the company want to achieve with the launch of the new magazine is to hit $10M in annual revenue.
Cost can be ignored in this case. The purchase methods includes:
Yearly subscription: 12 issues one year; $3 revenue/issue Retail: one issue at a time, $5 revenue/issue
Given that GQ circulation is less than 1 million in a year and the total circulation in a year is 1.6 million. If Fine Living represents a 5% market share, this is equivalent to 80,000 publications per year. In 2016, GQ’s circulation of publication was 944,549, a 62,973 decline from the previous year (Bloomgarden-Smoke, 2017).
2 Based on your assumption, can this new magazine get to the goal of $10M in annual revenue?
Based on the assumption of 80,000 publications per year, Fine Living magazine will not reach the $10M in annual revenue target and increase the magazine circulation, look into ad revenue, and possibly increase the sales price.
3 If your client follow your suggestion, is there any risk or recommendation should be take care of?
There is a risk there will be low growth than expected, and the company will take time to break even to sell the magazine. There is a need to create awareness among the target population, and this requires advertising and promotions. However, there is no guarantee that there will be a return on investments within the expected time.
Case 2 Question: Profitability analysis + Market Entry (Case as attachment)
1 What Factors should DevCo consider when evaluating its product portfolio and go-to- market strategy?
The performance of each product in the product portfolio- There are differences in individual products, and marketing is set aside considering individual product performance.
Market potential- Prioritizing the market and economic potential is necessary as the individual products have different growth prospects. The company should maximize in markets where there is growth potential. The most attractive markets tend to have a higher grow...