Affiniscape

Case Analysis Presentation ÐŽV Affiniscape

Define the Problem

About Affiniscape:

ÐŽKcame to existence in January 2001. It is a company that serves as a virtual extension of the staffs of small (state, regional, or local) trade and professional associations. As a ÐŽ§virtual staffЎЁ they would enhance the capabilities of the associationÐŽ¦s physical staff without increasing association costs. Their goal was to provide two general services for small associations: a comprehensive, easy-to-use Web site and a portfolio of affinity (related, similar) programs.

The company emphasized long-term client relationships based on repeat purchases and an extensive service commitment in their business model ÐŽV hence their focus on offering additional products and services.

The company had just closed its second year of operation and executives were sure the company was on the verge of a breakout year. However, given the financial performance at the closing of 2002, executives and shareholders agreed that the strategic direction and operational decisions had to be reassessed.

Goal

Resolve to increase company performance and profit by identifying an aggressive long-term strategy based on the companyÐŽ¦s current business model to take the company to the next level.

Objectives

Report a profit and increase in the companyÐŽ¦s viability through:

- Acquire 2,000 client associations in the next couple of years (present data from exhibit 1)

- Launch advertising campaign

- Offer incentives to existing clients for referrals

- Launch survey to assess why itÐŽ¦s 50/50 on associations who sign up or donÐŽ¦t sign up for Affiniscape services (after demos are conducted)

- Supplement e-mail solicitations with direct outreach to potential clients

- New compensation strategy/model for employees (currently their largest expense) including commission

- Increase the number of full-time employees (currently 2 full time for selling and one for selling existing clients support products)

Constraints

- Marketing outreach plan is undefined

- Limited advertising

- Depend too much on e-mail to contact potential clients

- Lack a defined target market

- Lack full time sales employees

- Payroll expenses > compensation too high

- Lack of investment on high technology (servers, computers, software), communication infrastructure, telephone system

- Not headquartered on right geographical areas

Distinctive Competency

- Developed client base quickly upon entering the market

- Enhance the capabilities of their clients to better serve their members > without increasing membership costs

- Focused on developing client relationships ÐŽV emphasized long-term client relationships and service commitment

- Employees highly skilled/qualified and knowledgeable on the industry

- Focused on annuity type products and services

- Company executives proficient in networking and attending trade shows

- Built many clients through client referrals > very successful for them

- Offer potential clients a demo > they are confident their product will sell once the executive has viewed it

Identify the Best Alternative

The qualitative data of the good alternatives

ÐŽP It would improve Affiniscape performance relative to its stated goals.

ÐŽP It would improve the effectiveness between revenues and marketing related activities and expenses.

ÐŽP It would strengthen the unique characteristic of Affiniscape, which would differentiate it from other competitors.

ÐŽP It brings Affiniscape a better marketing control.

General available alternative actions

ÐŽP Increase advertising expenditures

ÐŽP Increase initial or renewal license fees by 10 or 15 percent.

ÐŽP Add or lay off one of sales