the chair loom marketing plan

CST MIE 640
CHARMAIGNE SCOTT
HUNG HOANG
CHAIR LOOM
MARKETING PLAN
1
THE CHAIR LOOM MARKETING PLAN
TABLE OF CONTENTS
TABLE OF CONTENTS .......................................................................................... 2
1.0 Executive Summary ........................................................................................ 4
1.1 Value Proposition............................................................................................. 4
1.2 Situation Analysis ............................................................................................ 4
2.1.1
2.1.2
2.1.3
Market Demographics................................................................................. 6
Market Needs .............................................................................................. 6
Market Growth............................................................................................ 7
2.2 SWOT Analysis .............................................................................................. 13
2.2.1
Strengths ................................................................................................... 14
2.2.2
Weaknesses ............................................................................................... 14
2.2.3
Opportunities............................................................................................. 15
2.2.4
Threats....................................................................................................... 15
2.3
Competition................................................................................................... 16
2.4
Product Offering ........................................................................................... 17
2.5
Keys to Success............................................................................................. 17
2.6
Critical Risks................................................................................................. 17
3.0 Barriers to Entry ............................................................................................ 17
1. Customer Behavior: .......................................................................................... 17
2. Awareness of Product: ...................................................................................... 18
3. Advertising:....................................................................................................... 18
4.0 Marketing Strategy ....................................................................................... 18
4.1
Marketing Objectives.................................................................................... 18
4.2
Financial Objectives...................................................................................... 20
4.3
Revenue Model ............................................................................................. 21
4.4
Marketing Research ...................................................................................... 21
5.0 Management Team ........................................................................................ 23
Charmaigne Scott...................................................................................................... 23
Hung Hoang .............................................................................................................. 23
Sharolyn .................................................................................................................... 23
Denise ....................................................................................................................... 23
6.0 Exit Strategy .................................................................................................... 23
Table of Authorities .................................................................................................. 24
2
3
1.0
Executive Summary
Nothing can replace the human touch! SM
The Chair Loom is an innovative personal care appliance. The Chair Loom is a portable,
do it yourself, hair-weaving device for African American Women and weavers of hair art.
It saves consumers time and money while their hair recovers from damaging chemical
straighteners or ironing combs. Often, the hair of these women is in excellent condition
and remains braided.
The Chair Loom strategy is to expand its American and international presence as a
business to consumer enterprise. This is achieved via the Chair Loom e-commerce site
that will collect, store, retrieve, and disseminate customer database information.
Chair Loom orders are outsourced transactions for tracking and fulfillment. The Chair
Loom will affiliate with leading suppliers of personal care and household products such
as Igia1.
The Chair Loom site also provides downloadable instructions on its use, a braiding
community chat board, membership in BWAG, affiliations and income opportunities.
The Chair Loom has US patent pending status and is a uniquely positioned invention with
first mover advantage in offering a long awaited solution to African American women
who create or wear braid hairstyles.
1.1
Value Proposition
Our value proposition is that we are providing the Chair Loom for hair braiding of
extensions off of the head as a healthful alternative to chemical relaxers used by the
majority of our target segment of African American females. Added values include the
benefits of saving time, money and effort by using the Chair Loom.
1.2
Situation Analysis
The Chair Loom is a product that focuses on the African American female customer who
appreciates the result of quality hair braiding. She desires a simple machine that helps
achieve desirable braiding results for personal or client satisfaction. The Chair Loom is in
its fifth prototype stage. The result will be a redesign with appealing craftsmanship made
of durable materials with integrated automation technology into the customer’s home
braiding business environment.
Our market segment in the hair braiding industry includes beauty businesses, students,
entertainers and housewives. We will target these markets through a variety of media
including the Internet, catalog distribution, and word of mouth advertising. The Chair
1
http://store.yahoo.com/igiaonline/igtwis.html
4
Loom will remain affordable so that consumers in all incomes brackets will buy it.
Our strategy is to make our product information readily available to the target segment.
In addition, the development of a website will increase our company profile by promoting
the Chair Loom in the media most appropriate to our customers.
5
2.1
Market Summary
The Chair Loom product is positioned to attract those customers who want portability,
cost savings and flexibility. The Chair Loom product enjoys first mover opportunity in
the hair braiding industry.
It is the first product of its kind in targeting the African American female population
within the age range of 15-60 years old. This population has specific needs that
significantly differ from other populations who may also choose to wear their hair
braided.
Chair Loom marketing strategy is to offer a viable alternative to using chemicals and heat
to straighten the hair of the African American female customer. The price of the Chair
Loom is less than that typically paid to have single extensions braided into the hair.
Another important strategy is to emphasize how it saves time as part of our system of
braiding extensions off of the head when compared to braiding extensions into the hair.
Additionally, we will ensure target market awareness of the product through advertising
public relations campaigns using various media.
2.1.1 Market Demographics
Chair Loom customers consist of African American female consumers within the 15-60
year old age group such as young girls, housewives, professionals, students, entertainers,
etc.
Using the census data, we will market in cities where the African American female
population within the 15-60 year old age group is greater than 1000.
These individuals desire the convenience of braiding on the Chair Loom and appreciate
its important benefits in saving money, time and effort.
The second group consists of bricks and clicks such as beauty salons, schools and or
supply houses that cater to the personal care needs of the target segment.
2.1.2
Market Needs
Value is realized in tangible and intangible forms. The Chair Loom provides tangible
benefits derived when the customer creates a cache of braids to independently apply to
her cornrowed hair anytime she wants. Therefore, the pre-braids become re-usable for up
to five years or until the braids need replacing leaving virtually no waste of the preferred
synthetic fiber for braiding.
The Chair Loom system provides important benefits in correcting the damage to African
American hair caused by the use of hair straightening chemicals, hot curling irons or
straightening combs all used to create a straight hair style by breaking down the natural
wave and curl pattern of the segment hair.
6
The Chair Loom allows customers to wear pre-braids as a regular or substitute hairstyle
until hair damage has grown out into new alive virgin hair or as long as she desires.
The Chair Loom also provides a convenient way to stockpile pre-braids that are easily
attached when the customer decides she wants to change her hairstyle to the braided look.
Actually, hair that is good condition and undamaged make the best cornrows and thus,
the most attractive Chair Loom braid-styles.
Chair Loom customers will create the pre-braids as necessary or desired. They can
employ other Chair Loom braiders to develop a cache of pre-braids. These can then be
sold, given as gifts to enrich relationships with family and friends who drop by to visit or
simply saved for future use. An important result is a supportive and nurturing community
of users furthering the art of braiding through the Chair Loom e-community.
This saves the customer time. When the customer has created a satisfactory amount of
Chair Loom pre-braids, she will use significantly less time to supplement her cache
periodically-as the pre-braids wear out. The time it takes most conventional braiders to
complete individual braids is from 8-16+ hours.
In just one four-hour session, the Chair Loom can yield approximately 120 braids to
cover one head. It takes from one to four hours to sew these pre-braids onto her cornrows.
It takes about 40 minutes to remove the pre-braids for monthly salon or independent hair
care. Re-applying the pre-braids becomes easier with experience and the time factor is
tremendously reduced to less than two hours since she is re-using the existing pre-braids.
This saves the customer effort. The Chair Loom can help prevent wrist injuries caused by
repetitive motion required of conventional braiders. This problem is greatly reduced by
dispersing the labor among many, or by planning Chair Loom braid sessions to include
recommended rest periods every two hours.
This saves the customer money. The customer controls the output of Chair Loom prebraids. The cache of pre-braids allows greater independence and freedom of choice for
the customer. She can now independently sew her pre-braids into her cornrowed hair or
have the help of an assistant to expedite this phase. She has eliminated the hefty price of
$200+ for individual braids at a salon or done by an acquaintance.
2.1.3 Market Growth
We have combined US Census Bureau statistics comparing Black and White populations
in the four regions of the United States with CA Census Bureau statistics pertaining to
our product segmentation to provide information regarding our market growth.
7
Table 1-US Census 2000 estimate
Table 20b.
Population by Region, Sex, and Race and Hispanic Origin: March 2000
(Numbers in thousands)
-----------------------------------------------------------------------------------|Region and sex
|
|
Race and Hispanic Origin 1/
|
|
|
|-----------------------------------------------|
|
|
|
| White, not of |
|
|
|
Total
|
Black
|Hispanic origin|
Other
|
|
|---------------+---------------+---------------+---------------|
|
|Number |Percent|Number |Percent|Number |Percent|Number |Percent|
|------------------+-------+-------+-------+-------+-------+-------+-------+-------|
|Total 2/
|
|
|
|
|
|
|
|
|
| Total
|274,087| 100.0| 35,509|
13.0|193,633|
70.6| 44,945|
16.4|
| Northeast
| 52,038| 100.0| 6,561|
12.6| 39,404|
75.7| 6,073|
11.7|
| Midwest
| 63,595| 100.0| 6,817|
10.7| 52,487|
82.5| 4,291|
6.7|
| South
| 95,928| 100.0| 19,321|
20.1| 63,464|
66.2| 13,143|
13.7|
| West
| 62,526| 100.0| 2,809|
4.5| 38,278|
61.2| 21,439|
34.3|
|Male
|
|
|
|
|
|
|
|
|
| Total
|133,933| 100.0| 16,581|
12.4| 95,049|
71.0| 22,303|
16.7|
| Northeast
| 24,959| 100.0| 2,974|
11.9| 19,144|
76.7| 2,840|
11.4|
| Midwest
| 31,279| 100.0| 3,164|
10.1| 25,910|
82.8| 2,205|
7.0|
| South
| 46,880| 100.0| 9,063|
19.3| 31,237|
66.6| 6,579|
14.0|
| West
| 30,815| 100.0| 1,380|
4.5| 18,757|
60.9| 10,678|
34.7|
|Female
|
|
|
|
|
|
|
|
|
| Total
|140,154| 100.0| 18,927|
13.5| 98,584|
70.3| 22,642|
16.2|
| Northeast
| 27,079| 100.0| 3,587|
13.2| 20,260|
74.8| 3,232|
11.9|
| Midwest
| 32,316| 100.0| 3,653|
11.3| 26,577|
82.2| 2,086|
6.5|
| South
| 49,048| 100.0| 10,258|
20.9| 32,227|
65.7| 6,563|
13.4|
| West
| 31,711| 100.0| 1,429|
4.5| 19,521|
61.6| 10,761|
33.9|
-----------------------------------------------------------------------------------1/ Hispanic refers to people whose origin are Mexican, Puerto Rican, Cuban, South or
Central American, or other Spanish origin regardless of race.
2/ Regions are described in the CPS glossary of
subjects concepts at
2
www.census.gov/population/www/cps/cpsdef.html .
SOURCE: U.S. Census Bureau, Current Population Survey, March 2000, Racial Statistics
Branch, Population Division.
Internet Release date: February 22, 2001
3
These statistics also show correlating population percentages. This allows some
translation of the facts given in the Trends survey on African American consumer
spending in the personal care industry, specifically focusing on their hair care
expenditures. According to the April 2000 issue of Happi.com, the buying power of this
segment has generated recognition such that major hair care manufacturers have
purchased or partnered with the former ethnic hair care specialty manufacturers.
Our focus is on African American females within the 15 to 60 years old age group
residing in the State of California. The following statistics show segment residents in the
various counties of CA. Further examination showed that the majority of this segment
resides primarily in very large cities such as Los Angeles, San Francisco, Oakland, San
Jose and San Bernardino. Next in line are significantly smaller cities with sizable
segment populations including Alameda and Monterey County.
2
3
www.census.gov/population/www/cps/cpsdef.html
U.S. Census Bureau, Current Population Survey, March 2000, Racial Statistics
Branch, Population Division.
Internet Release date: February 22, 2001
8
These areas provide the essential CA regional test market. We will follow the CA 2000
census (see Figure 1) and deploy the Chair Loom to target cities having 1000 or more of
our segment consumers ranging in age from 15-60 years old. According to the CA 2000
census, our market segment population totals at 327,722. Information Resources, Inc.
shows that African American hair care product sales comprise 83% of $308.6 million of
the ethnic personal care market revenues.
We plan to capture 0.5% of that market’s revenues to reach our projection of $1,540,000
by selling Chair Looms for $200.00 each to 7700 customers. The CA 2000 Census data
shows 327,722 potential customers within our market. Therefore, to reach our equivalent
goal of 0.5% of the ethnic personal care market revenues, we can target 2.4% of the CA
population. This equals 7700 people. (See Figure 1)
According to the year 2010 California census projections (see Figure 2), we can
reasonably predict our market growth as increasing in line with the Census forecasts
below. Although these predictions show that some areas will experience growth
reduction, most areas remain stable or experience slight to significant market segment
increases. This justifies our strategy in marketing the Chair Loom to the market segment
in cities with sizable populations of African American females within the preferred age
range. The income information that was not readily available was therefore, not factored
into our research. (See Figure 2)
9
Figure 1-CA Census 2000 estimate
2000 ESTIMATE
ALAMEDA
ALPINE
AMADOR
BUTTE
CALAVERAS
COLUSA
CONTRA COSTA
DEL NORTE
EL DORADO
FRESNO
GLENN
HUMBOLDT
IMPERIAL
INYO
KERN
KINGS
LAKE
LASSEN
LOS ANGELES
MADERA
MARIN
MARIPOSA
MENDOCINO
MERCED
MODOC
MONO
MONTEREY
NAPA
NEVADA
ORANGE
PLACER
PLUMAS
RIVERSIDE
SACRAMENTO
SAN BENITO
SAN BERNARDINO
SAN DIEGO
SAN FRANCISCO
SAN JOAQUIN
SAN LUIS OBISPO
SAN MATEO
SANTA BARBARA
SANTA CLARA
SANTA CRUZ
SHASTA
SIERRA
SISKIYOU
SOLANO
SONOMA
STANISLAUS
SUTTER
TEHAMA
TRINITY
TULARE
TUOLUMNE
VENTURA
YOLO
YUBA
15-19
9,061
0
31
123
6
2
3,452
7
20
1,722
5
35
115
3
1,502
273
45
13
31,316
190
232
1
30
362
2
2
819
55
5
1,707
55
8
3,475
5,128
6
6,642
6,928
2,662
1,218
175
1,218
444
2,090
151
63
0
22
2,237
311
418
50
10
2
241
13
654
237
118
85,712
49,543
20-24
8,560
0
31
111
7
5
3,287
6
28
1,591
6
52
108
2
1,419
327
53
21
29,025
749
208
0
22
367
3
2
706
65
9
1,736
63
4
3,226
4,719
16
5,890
8,072
2,559
1,155
165
1,122
417
2,158
114
55
0
35
2,061
274
361
58
12
2
211
10
668
289
69
82,291
46,300
25-29
8,645
0
6
92
0
1
3,168
4
29
1,345
9
52
110
0
1,227
351
38
15
27,798
887
186
0
12
307
1
1
593
60
6
1,833
60
4
2,857
4,194
10
5,277
8,161
2,536
1,054
129
1,035
355
2,406
104
43
0
25
1,909
239
282
65
11
0
188
11
659
158
65
78,613
44,327
30-34
9,705
0
13
89
2
3
3,161
2
16
1,399
1
57
87
1
1,239
392
30
15
35,536
496
214
2
6
313
0
2
998
51
1
1,833
32
0
2,845
4,482
1
5,874
6,921
2,968
918
129
1,209
388
2,628
111
33
0
9
1,931
252
257
49
5
0
159
12
581
116
104
87,678
53,077
35-39
11,236
0
13
94
4
0
3,512
3
32
1,581
1
42
94
2
1,366
268
37
11
44,261
223
264
2
11
329
0
2
1,026
55
4
1,615
47
5
3,305
5,251
6
6,744
5,243
3,430
966
93
1,513
432
3,061
123
36
0
21
2,214
263
344
74
5
0
187
8
690
110
121
100,380
64,127
10
40-44
11,254
0
12
95
10
4
3,659
3
28
1,410
3
37
108
1
1,355
269
36
7
43,866
131
279
1
11
319
2
0
794
52
4
1,486
47
6
3,320
5,131
6
6,442
4,900
3,423
1,068
100
1,424
386
2,969
106
44
0
30
2,294
223
363
63
9
3
156
6
668
112
77
98,612
63,615
45-49
10,311
0
12
77
10
1
3,369
6
16
1,210
6
26
83
1
1,037
235
41
12
37,244
110
265
4
11
265
0
1
505
48
2
1,448
52
2
2,732
4,048
6
5,047
4,797
3,033
923
89
1,303
287
2,254
92
17
0
24
1,991
183
263
50
7
0
173
7
611
86
55
84,488
54,937
50-54
8,387
0
37
47
2
0
2,951
1
18
918
3
15
65
1
755
180
32
3
30,921
101
194
2
6
176
0
1
280
42
0
1,250
39
5
2,101
2,825
7
3,561
3,545
2,437
636
63
1,077
209
1,802
58
21
0
18
1,561
152
213
29
8
0
118
2
472
71
36
67,454
45,286
55-59
5,700 82,859
0
0
12
167
28
756
3
44
1
17
2,118 28,677
0
32
14
201
623 11,799
0
34
11
327
60
830
1
12
579 10,479
101 2,396
32
344
0
97
24,038 304,005
90 2,977
127 1,969
0
12
6
115
124 2,562
0
8
0
11
231 5,952
31
459
5
36
919 13,827
47
442
1
35
1,515 25,376
2,065 37,843
3
61
2,383 47,860
2,637 51,204
1,840 24,888
487 8,425
46
989
885 10,786
164 3,082
1,382 20,750
37
896
22
334
0
0
8
192
1,002 17,200
107 2,004
143 2,644
25
463
5
72
0
7
85 1,518
4
73
347 5,350
61 1,240
23
668
50,178 735,406
34,013 455,225
35,971
415
13,068
6,057
420
5,387
1,343
123,675
2,322
840
1,349
3,116
7,109
12,403
18,523
23,683
30,082
10,725
4,345
598
4,584
1,604
9,282
480
8,138
1,076
1,318
799
2,562
800
356
327,722
Figure 2-CA Census 2010 estimate
2010 ESTIMATE
ALAMEDA
ALPINE
AMADOR
BUTTE
CALAVERAS
COLUSA
CONTRA COSTA
DEL NORTE
EL DORADO
FRESNO
GLENN
HUMBOLDT
IMPERIAL
INYO
KERN
KINGS
LAKE
LASSEN
LOS ANGELES
MADERA
MARIN
MARIPOSA
MENDOCINO
MERCED
MODOC
MONO
MONTEREY
NAPA
NEVADA
ORANGE
PLACER
PLUMAS
RIVERSIDE
SACRAMENTO
SAN BENITO
SAN BERNARDINO
SAN DIEGO
SAN FRANCISCO
SAN JOAQUIN
SAN LUIS OBISPO
SAN MATEO
SANTA BARBARA
SANTA CLARA
SANTA CRUZ
SHASTA
SIERRA
SISKIYOU
SOLANO
SONOMA
STANISLAUS
SUTTER
TEHAMA
TRINITY
TULARE
TUOLUMNE
VENTURA
YOLO
YUBA
15-19
20-24
11,557 10,487
0
0
7
24
131
153
7
8
0
2
4,113
3,919
8
7
27
32
2,381
1,973
2
3
44
55
125
134
1
1
2,143
2,097
351
467
83
84
14
19
37,120 32,964
282
826
259
243
4
1
13
31
418
370
5
2
2
3
810
1,119
62
99
8
8
2,189
2,260
78
84
5
11
4,762
4,613
6,991
6,507
18
15
9,349
8,885
8,925 10,578
3,004
2,720
1,678
1,365
168
217
1,073
1,195
481
497
2,500
2,563
129
158
56
68
0
0
14
40
2,717
2,618
359
409
502
506
69
73
18
19
3
0
273
255
41
35
695
695
257
350
112
147
106,443 102,014
106,020 101,327
25-29
9,425
0
32
143
11
2
3,587
12
29
1,760
5
41
174
3
1,809
471
65
24
24,837
1,077
271
1
35
361
2
2
1,022
68
5
2,040
71
8
4,127
5,864
11
7,853
9,398
2,526
1,306
201
1,100
352
2,276
133
71
0
27
2,449
345
503
70
18
2
256
27
685
209
118
87,320
86,708
30-34
8,960
0
34
130
9
5
3,402
11
38
1,631
6
53
162
2
1,689
413
73
31
22,088
767
257
0
27
362
3
2
900
75
9
1,833
82
4
3,910
5,499
21
7,193
7,126
2,388
1,240
183
990
354
2,331
110
64
0
40
2,358
303
454
75
17
2
222
24
704
145
69
78,880
78,268
35-39
8,830
0
10
104
0
1
3,220
7
37
1,377
9
54
150
0
1,382
271
64
20
22,721
386
231
0
17
302
1
1
705
70
6
1,561
80
4
3,585
4,901
15
6,386
5,069
2,339
1,140
115
902
360
2,510
124
48
0
28
2,212
265
372
76
16
0
199
30
702
120
65
73,200
72,691
11
40-44
9,692
0
14
96
2
3
3,151
2
21
1,413
1
60
118
1
1,366
340
59
18
31,879
197
242
2
11
305
0
2
1,035
60
1
1,519
43
0
3,469
4,987
5
6,601
4,889
2,777
982
111
1,087
390
2,681
124
36
0
9
2,152
269
326
59
10
0
172
28
612
125
101
83,655
83,211
45-49
11,076
0
13
98
4
0
3,469
3
37
1,573
1
42
119
2
1,496
312
61
16
40,990
158
279
2
11
318
0
2
1,035
59
4
1,479
55
5
3,729
5,508
6
7,081
4,806
3,235
988
109
1,390
428
3,059
130
41
0
21
2,328
269
388
81
10
0
193
18
696
125
116
97,474
96,987
50-54
10,928
0
12
99
10
4
3,556
3
33
1,383
3
37
127
1
1,445
285
66
12
40,667
172
285
1
11
305
2
0
788
53
4
1,424
61
6
3,592
5,181
6
6,524
4,692
3,223
1,065
114
1,302
378
2,911
109
49
0
30
2,314
226
393
68
14
3
161
12
658
120
72
95,000
94,562
55-59
9,801 90,756 40,429
0
0
12
158
81
1,035
557
10
61
1
18
3,185 31,602 15,021
6
59
20
274
1,167 14,658
7,745
6
36
26
412
99
1,208
595
1
12
1,104 14,531
7,738
244
3,154
1,702
78
633
305
17
171
33,730 286,996 117,009
196
4,061
2,952
264
2,331
1,030
4
15
11
167
248
2,989
1,511
0
15
1
15
497
7,911
3,851
50
596
2
47
1,366 15,671
8,322
62
616
315
2
45
2,909 34,696 17,412
3,993 49,431 24,861
6
103
5,007 64,879 33,280
4,495 59,978 36,027
2,817 25,029 10,638
919 10,683
5,589
100
1,318
769
1,172 10,211
4,358
276
3,516
1,684
2,167 22,998
9,670
92
1,109
530
22
455
0
0
24
233
1,949 21,097 10,142
187
2,632
1,416
283
3,727
1,965
51
622
9
131
0
10
172
1,903
1,006
13
228
588
6,035
2,779
91
1,542
961
50
850
446
79,683 803,669 368,137
79,342 799,116
The following Sample Survey 1 was conducted on May 9, 2002 to provide the views of
African American braiders ages 15-60 living in CA. These women have actually tested
and used the Chair Loom. According to our survey, these braiders prefer to use the Chair
Loom and would become customers when it becomes available because it will save them
time, money and effort in their braiding businesses.
Sample Survey 1- 5 BRAIDERS: Q & A
Shirelle- Mother, Student, HairBraider Would love to join the BWAG-Age 22
Tene-Braider Nefertiti, Cosmetology student, Yes! Join the BWAG-Age 25
Tanisha-Mother, SJCC Cosmetology Student-BWAG-21
Aesha-SJCC Business Major, BWAG-30-Health-Carpal Tunnel Syndrome caused by braiding.
Sharolyn-Mother, Wife, Student, Hair Braider-Would help establish the BWAG-Age-NYOB
1.
2.
3.
How many braid customers do you have pe
Shirelle
Tene
Tanisha
Aesha
Sharolyn
How much do you charge per customer?
Shirelle
Tene
Tanisha
Aesha
Sharolyn
What type of braids for that price?
Depends on
4.
Do you enjoy braiding?
5.
6.
How many hours on individuals?
Where do you perform this function?
7.
Why do you braid?
8.
How do you compare braiding to
other jobs?
Why?
9.
How many braiders do you know?
10. Do you think they would be interested
in trying a Chair Loom?!
15
15
12
15
05
$50.00-$350.00
“
“
“
“
1.
Braid type
2.
Micros (1/4 size of a penci
Time
requirements
12-15hrs
3.
Individuals (bigger than pe
4-6hrs
4.
Styled Cornrows
3+hr
5.
Plain Cornrows
2hrs
Money is good, Labor is bad,
If people are likable, then enjoy it,
If not it’s over, perfunctory (repetitive, ritual)
13 hours+: client requirements, size, length and time
Prefer home, however will travel but it is very inconvenient.
Shoes off with friends, camaraderie
Started as a hobby and progressed into a sure money-maker
without needing a degree, likes being her own boss, good at
it, can set schedule, supplement income while going to scho
If she really wanted to become self employed, it would be a
braiding business.
Sales rep. Individual, non-licensed, entrepreneur, doctor hair
people come in with hurt, busted hair and need repairs.
Some women have good strong healthy hair and want braids
for convenience and time management.
Shirelle
3
Tene
5
Tanisha
4
Aesha
7
Sharolyn
10
Everyone says Sure! We’ll give it a try.
It would save us time and money!
12
2.2
SWOT Analysis
The Chair Loom has a valuable inventory of strengths that will help it succeed.
Strengths include: patent pending, recovery time for damaged hair, eliminating overtension and or too tight braiding, customer presence during braiding is no longer a
condition, the Chair Loom is easy to learn and can cause income creation. Another
strength is our strong focus on the ethnic hair care market need.
The Chair Loom has at least two weaknesses that must be addressed.
Weaknesses include: a need for Chair Loom size expandability. Our one-size-fits-all
Chair Loom does not work for all customers. However, we plan the one-size fits all in
future Chair Loom models.
The need for flexibility in how the Chair Loom can be used is very important to
customers. For example, customers want to mount it on the wall, desk or other sturdy
surface to accommodate their purpose.
The Chair Loom's strengths will help it capitalize on emerging opportunities.
Opportunities include, but are not limited to, a growing population of African American
and international ethnic hair care product consumers who are potential Chair Loom users.
Threats that Chair Loom should be aware of include, the vast improvements in chemical
straightening technology and the majority preference of African American women to use
chemical straighteners on their hair rather than braiding or natural styles. Another
potential threat is due to the aging of our market segment resulting in a reduction of
customer base.
13
2.2.1
Strengths
1.
The Chair Loom eliminates over-tension that can pull out hair by the roots.
2.
Stops the mistakes of too tight braiding on the scalp that causes bleeding scalp
syndrome.
3.
The customer does not need to remain stationary for long periods of time or to
be present during the pre-braid process.
4.
The customer can easily learn how to use the Chair Loom to braid
independently.
5.
The customer can increase her income by braiding for others and
demonstrating the Chair Loom.
6.
The Chair Loom has received its patent pending.
7.
The Chair Loom gives the African American woman’s hair a chance to
recover from damaging treatments.
2.2.2 Weaknesses
1.
Currently, the Chair Loom model is available only in medium sizes. When a
customer sits on the Chair Loom, her leg must fit through the leg opening. If
her leg does not fit, then another size must become available.
2.
Customers have requested modifications such as making the Chair Loom
surface mounted.
3.
Lack of management, marketing and financing.
14
2.2.3
Opportunities
1.
“An African-American woman is only comfortable buying a product that she
feels has been designed with her needs in mind, even if that product is
designed for the general population.”
2.
In recent years, the ethnic hair care market has been transformed by a rash of
acquisitions and mergers that are proof of the growing importance of the black
consumer.
3.
Black women have traditionally been more apt to change hairstyles from dayto-day than other women and this fickleness has extended to color.
4.
The April 2000 issue of Happi.com African American consumers “account for
30% of all hair care purchases…“The ethnic market is going to outstrip the
general market in growth by so much, it’s going to be scary,” said Darryl
Mobley, co-founder and chief executive officer of www.beautyandsoul.com,
an e-commerce site devoted to the sale of ethnic beauty products. “The
population is rising and so is its purchasing power.”
5.
While the African-American population in the U.S. is growing in both size
and spending power, ethnic hair care marketers recognize the importance of
international markets too. www.Beautyandsoul.com ’s Mr. Mobley said that
50% of purchases made on his web site are from consumers outside of the
U.S. “Women in the Caribbean, women in Africa, women all over the world
are coming onto our site and saying they need these products,” he said. “These
women are vital consumers to us and to marketers of ethnic hair care
products.”4
2.2.4
Threats
1.
A serious threat to marketing the Chair Loom is the fact that the chemicals
used to process, breakdown and straighten the hair of African American
consumers have improved significantly.
2.
Additionally, a potential threat is due to the aging of our market segment
resulting in reduction of potential customer base.
The predominant lye 5 (sodium hydroxide 6) content has been replaced with thiogylcolate,
calcium hydroxide or other less damaging compounds. These chemicals no longer cause
the severe burns or hair fallout that lye caused. However, they are still very dangerous.
4
http://www.happi.com/special/apr001.htm
http://www.ccohs.ca/oshanswers/chemicals/chem_profiles/sodium_hydroxide/basic_sod.html
6
http://www.happi.com/special/0601form.htm#c
5
15
This is an important reason why over 2/3 of survey participants said they preferred
relaxing their hair with the better class of chemical relaxers. Only 1/3 of those surveyed
preferred the natural look.
According to Information Re-sources Inc., Chicago, African-American hair care product
sales comprised 83% of the $308.6 million ethnic personal care market, rising 1.9% to
$257.3 million during the 52-week period ended Jan. 9. Chemical products were the
biggest part of this segment with $81.6 million in sales while hair color sales rose 33.4%
to $35.7 million.7
2.3
Competition
Existing, automated hair braiding and twisting devices braid the client’s hair directly on
her head. In contrast, the Chair Loom is designed specifically for pre-braiding synthetic
extensions off of the head. This method eliminates the previous requirement for the client
to remain present, seated and stationary while the braids are created on her head. Due to
the fact that this inconvenience is now removed and that the braids are created externally,
away from the client’s head, the Chair Loom occupies a unique niche within the African
American braiding market.
The competition does not provide comparable products because they do not specifically
target and benefit braiders of African American consumers or their hair types. The dearth
of hair braiding machines that target the African American segment personal care needs
prompted the invention of the Chair Loom. Still, there exist three unique, well made,
properly marketed and financed hair braiding machines.
Our nearest competition advertises and markets on the web as well through expensive TV
infomercials. This competition includes the Igia Twist a Braid,8. Conair’s Quick & Easy
Braider,9 and Antita’s Portable Braiding machine10. Although these are excellent
products, we think the Chair Loom remains unique in design and purpose. Yet, we
welcome and will explore partnership opportunities to turn competition into allies for
mutual benefit and customer satisfaction.
Another source of competition may come from different types of loom makers who merit
consideration. They make looms for purposes ranging from industrial uses such as
vehicle tires that are really braiding results to rugmaking.
These international companies present manufacturing as well as distribution channels for
their products through craft supply stores, tire outlets or their own retail locations.
However, the established loom makers offer very large, industrial strength looms that our
segment target would have little use for.
Still, these loom makers actively seek innovative solutions for new loom applications, so
7
http://www.happi.com/special/apr001.htm
http://www.health4her.com/igia.cfm?adnum=igiaovera
9
http://mp.hairboutique.com/list.asp?Action=search&MnfID=24&ACID=56&APID=2
10
http://www.hair21.com/
8
16
the Chair Loom may be of interest to them. Such companies also offer product
development, manufacturing and distribution outsourcing opportunities11 that may help
further our marketing endeavors in the US as well as internationally.
2.4
Product Offering
1. What is the Chair Loom?
The Chair Loom is a device that allows external
braiding of synthetic hair extensions that will then be attached/sewn to the client’s
cornrowed hair tracks.
2. Costs: The Chair Loom costs less than the price of one visit to the local African
American salon for individual braids. One Chair Loom will cost $200.00
3. Segment:
African American females. Age group: 15-60 years old.
4. Why?
Saves time, effort and money on hair braiding.
5. What customer need does the product fill? Fulfills customer need to save time,
money and effort as well as providing a sense of independence and freedom of
choice in the hair braiding industry.
2.5
Keys to Success
The Chair Loom combines affordability, ease of use, and convenience for the enterprising
customer who prefers to have another choice in how their hair braiding needs are met.
Consumers can now have a stock of pre-braided extensions ready for whenever they are
ready to change their style to the braid look for whatever reasons. The Chair Loom is
portable, light weight and can fit in most oversized travel bags.
2.6
Critical Risks
The risks involved for marketing the Chair Loom are:
3.0
•
Will there be a continuing demand for the Chair Loom?
•
Will the popularity of the Chair Loom continue to grow, or is the Chair Loom a
fad?
•
Will individuals be willing to pay for the Chair Loom?
•
Will the cost of using the Chair Loom from home drop so significantly that there
will not be a market for braiding devices such as the Chair Loom?
Barriers to Entry
1.
Customer Behavior:
Our segment tends to prefer chemical hair straighteners over the natural looking hairdos.
11
http://dir.tpage.com/15/09/9.html
17
2.
Awareness of Product:
Difficulty in creating brand awareness.
3.
Advertising:
These costs are prohibitive.
4.0
Marketing Strategy
Chair Loom has three main strategies. The first strategy focuses on attracting potential
Chair Loom customers. By providing demonstrations and downloadable instructions, we
hope to develop a loyal Chair Loom customer base.
The second and most important strategy focuses on pulling in attracting segment Internet
users. This group of customers will form the backbone of the Chair Loom e-community.
They will order our product online and expect prompt delivery.
This prompt delivery will occur through the use of various outsourcing partners that form
our supply web. We receive the initial order via our Chair Loom order page. It is then
immediately transmitted to the various tiers of our supply web simultaneously to provide
the end result of customer satisfaction and e-commerce repetition.
The Internet allows the establishment of effective, instantaneous, and collaborative
communication among the tiers including the manufacturer, distributor, shipping and the
ultimate customer. Communication between and among all tiers of the supply web
expedites the flow of goods while reducing overhead costs. This also eliminates
warehousing and reduces costs involving packaging and shipping.
In turn, the satisfied customer will help spread awareness of the Chair Loom by showing
others how they achieved such beautiful, unique and personality-filled braid artistry
results. The newly interested customer will become familiar with how easy it is to order
her own Chair Loom over the web. This will be the principle manner in which the Chair
Loom is virally marketed and the e-community proliferates.
The third strategy focuses on building a social environment for Chair Loom customers. A
social environment that provides the web based community discussion forum to support
the Braiders and Weavers of Art Guild (BWAG) of Chair Loom users. This site will also
attract customers who wouldn't normally think about using the Internet. After visiting the
BWAG site and learning about the Chair Loom and the BWAG user community,
potential customers will also wish to join the BWAG and become proud Chair Loom
owners.
4.1
1.
Marketing Objectives
Our initial objective is the market to our segment population of African
American females ranging in age from 15-60 years old and living in CA.
18
2.
This will help gauge feasibility. If our projections are on target, then we will
proceed with future plans. These plans allow expansion into our segment
market covering the United States.
3.
Further expansion into the international segment market is dependent upon
successful penetration of the US market.
19
4.2
Financial Objectives
1.
First year: This objective can be measured by sales of 7700 units=0.5% of the
ethnic personal care market.
2.
Second year: This objective can be measured by sales of 15400 units=1.0 % of
the ethnic personal care market.
3.
Third year: This objective can be measured by sales of 30800 units=0.2.0 %
of the ethnic personal care market.
Financial Objectives 1
Ethnic care market per year
.5% of market share
1% of market share
2% of market share
$308,000,000
$1,540,000
$3,080,000
$6,160,000
Cost per unit
Units sold to achieve .5%
Units sold to achieve 1%
Units sold to achieve 2%
$200
7700
15400
30800
Patent (US) & maintenance fees
Web site (server, maintenance, consultant)
CTO
CEO
Office rental
Equipment rentals (computers, desks, etc.)
Sales/Marketing (2 half time position)
Co-location for server (per year)
Marketing
Cost to manufacture ($25/unit) @ .5% share
Cost to manufacture ($25/unit) @ 1% share
Cost to manufacture ($25/unit) @ 2% share
$5,000
$22,000
$45,000
$45,000
$14,000
$24,000
$50,000
$2,400
$40,000
$192,500
$385,000
$770,000
$13/unit shipping cost @ .5% share
$13/unit shipping cost @ 1% share
$13/unit shipping cost @ 2% share
$100,100
$200,200
$400,400
Total cost for first year @ .5% share
Total cost for second year @ 1% share
Total cost for third year @ 2% share
$540,000
$832,600
$1,417,800
1st year predicted revenue @ .5%
2nd year predicted revenue @ 1%
3rd year predicted revenue @ 2%
$1,000,000
$2,247,400
$4,742,200
20
4.3
Revenue Model
Income will be generated from customers visiting our website.
Business to business transactions: Salons, supply houses and distributors.
4.4
Marketing Research
The April 2000 issue of Happi.com African American consumers “account for 30% of all
hair care purchases…“Darryl Mobley, co-founder and chief executive officer of
www.beautyandsoul.com, an e-commerce site devoted to the sale of ethnic beauty
products. “The population is rising and so is its purchasing power.”
www.Beautyandsoul.com ’s Mr. Mobley said that 50% of purchases made on his web site
are from consumers outside of the U.S. “Women in the Caribbean, women in Africa,
women all over the world are coming onto our site and saying they need these products,”
survey conducted recently and located on the following site:
http://pub28.bravenet.com/vote/stats.php?usernum=2388925041 reflects the views of
participants on whether or not they are satisfied or dissatisfied with their current hair care
and the professionals involved.This poll demonstrates the need for the Chair Loom within
the target market segment.
Bomb Polls
Current Vote Statistics
Question 1: Are you happy with your current hair style?
votes percent
1.) Yes
137
17%
2.) No
374
47%
3.) Sometimes
278
35%
123
Total Votes: 789
Question 2: Are you happy with your current hair stylist or salon?
votes percent
1.) Yes, very happy
194
25%
2.) No, not at all
85
11%
3.) Don't have one
339
43%
4.) Sometimes
168
21%
21
1234
Total Votes: 786
Question 3: Do you prefer to wear natural or relaxed hair?
votes percent
1.) Natural
249
32%
2.) Relaxed
531
68%
12
Total Votes: 780
Question 4: What is your Biggest Hair Stress
percent
votes
1.) Dry Hair
169
23%
2.) Hair Loss/Thinning
104
14%
3.) Hair Growth
182
25%
4.) Hair Style
268
37%
1234
Total Votes: 723
22
5.0
Management Team
Charmaigne ScottFounder and CEO-Inventor of Chair Loom
MS Management and Information Technology
Charmaigne Scott brings originality, vision and leadership to lead our team. Her breadth
of education and experience include solid people skills and problem solving. She has
years of extensive fundraising for numerous charitable organizations. Charmaigne has
provided entertainment for fundraising events at prestigious establishments for notable
figures such as the Honorable Sam Farr and Mr. Leon Panetta, former White House Chief
of Staff. Charmaigne is also interested in creating unique ways to elevate underrepresented communities.
Hung Hoang
CTO-Manager and ConsultantMS Management and Information Technology
Hung Hoang brings vision, leadership and strategic direction to our team. His experience
lies in the planning and implementation of information systems and technology. He has
over 15 years experience in Information Technology and 8 years of sales experience. His
current position is system administrator in a multi-platform environment where he has a
strong track record of planning, developing, coordinating and providing technology
solutions. He has been responsible for operation policies and procedures that support an
IT (Information Technology) infrastructure, architecture, and program for both
instructional and administrative functions. He has a bachelor’s degree in Computer
Science.
Sharolyn
Marketing-Braid Professional
Sharolyn graduates from Hartnell College in 2002 with a degree in business. She is active
in organizing charitable events and braids hair because she enjoys the freedom of
entrepreneurship along with interaction with African American females of all ages.
Denise
Sales Coordinator-Licensed Cosmetologist
Denise attends UCSC and is studying business practices that include accounting and
management. She is a licensed cosmetologist and is active in church business. Denise
also enjoys braiding on the Chair Loom and will demonstrate and sell it to her customers
in her beauty shop in Santa Cruz, CA.
6.0
Exit Strategy
Our goal is be acquired or bought out by a leading distributor in five years.
Another goal is to maintain the innovative and fresh appeal of the Chair Loom by
ensuring that other leaders in our company are ready and able to assume the helm
23
Table of Authorities
http://store.yahoo.com/igiaonline/igtwis.html ................................................ 4
http://www.happi.com/special/apr001.htm......................................... 4, 15, 16
Information Re-sources Inc .......................................................................... 16
www.census.gov/population/www/cps/cpsdef.html....................................... 8
Table 1-US Census 2000 estimate .................................................................. 8
Figure 1-CA Census 2000 estimate .............................................................. 10
Figure 2-CA Census 2010 estimate .............................................................. 11
Sample Survey 1- 5 BRAIDERS: Q & A..................................................... 12
Financial Objectives 1 .................................................................................. 20
24